Economics 1
- Created by: Gabrielle
- Created on: 29-12-13 15:42
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- Business Environment
- 1.) Decision making involves trade offs
- Technical, productive, allocative and social efficiency
- 2.) Involves Opportunity costs - the cost of something forgone
- 3.) People and businesses think at the margin --> marginal costs
- 4.) People respond to incentives
- 5.) Trade can make everyone better off
- 7.) Governments can improve market outcomes
- Market Failure
- Externalities
- Market Power
- Externalities
- Market Failure
- 6.) Markets are a good way to organise economic activity
- 8.) An economy’s standard of living depends on its ability to produce goods and services
- GDP per head
- 9.) Prices rise when the government prints too much money
- Inflation
- 10.)Society faces a short-run trade-off between inflation and unemployment
- Phillips Curve
- 1.) Decision making involves trade offs
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