Chapter 18 Economics study guide
Terms in this set (7)
List and briefly explain the four reasons to study economics which were presented in class
1) is answers the "why" question
2) It helps avoid "unintended consequences"
3) it sharpens analytic skills
4) it provides a useful way of thinking
Economics is studied at two levels. list and briefly explain the two branches of economics. Your answer should include the types of questions that are addressed in each
1) Macroeconomics: studying economics at a society-wide level:
A) what makes economies expand and flourish?
B) What makes economies experience recessions or depressions?
C) What causes fluctuations in prices, interest rates, employment levels
2) Microeconomics: studying economics at the industry, company, or consumer level:
A) How are prices of specific products set
B) What determines the flow of resources in an out of industries?
C) What determines how companies and consumers make economic decisions?
List and briefly explain the four indicators of macroeconomic performance which were presented in class
1) Gross Domestic Product (GDP)
3) Business cycle
4) Price levels
List and briefly explain the three major schools of thought in macroeconomics
1) Classical ("laissez faire") economics
2) Keynesian economics: Two approaches to managing an economy
3) Managed economics
What do you need to know to pass micro-economics?
How to read a graph
What is the core concpet in micro-economics? Explain this concept
Supply and demand
List and briefly explain the four levels of economic competition
1) Pure competition
2) Monopolistic competition