ECO2013 Lecture 1 Outline of Current Lecture I. Is life getting better or worse?II. Basic terms and definitionsIII. Eight guideposts to economic thinkingIV. Positive and normative economicsV. Four pitfalls to avoid in economic thinkingCurrent Lecture Chapter 1: Economic Approach Is life getting better or worse? What objective measures should we analyze?- Life expectancy- Health- Income- Education- Entertainment Changes in:- Transportation- Technology- Medicine- Entertainment What is Economics? Economics: The study of how we make choices under scarcity- 1.Choice: The act of selecting among alternatives- 2.Scarcity: The concept that there is less of a good freely available from nature than people would like Example) Time, money, and college textbooks are all scarce Scarcity Scarcity isn’t the same thing as poverty Scarcity necessitates rationing - Rationing: Allocating scarce goods to those who want them (price is used to ration goods) Scarcity leads to competitive
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