뒤로BEAP ch1, 3,4
02:08
이 집합의 용어 (21)
The study of how individuals, businesses, governments, and entire societies make choices to cope with scarcity—where human wants exceed available resources—and the incentives that influence those decisions.
Core Problem: Managing scarcity and aligning personal choices with broader economic goals.
Microeconomics: Focuses on individual decision-makers and specific markets, analyzing how they make choices, and respond to policies.
Macroeconomics: Examines the economy as a whole, focusing on aggregate phenomena such as inflation, total unemployment, national income, and overall economic growth.
1: How do choices end up determining what, how, and for whom goods and services are produced using the factors of production?
2: Do choices made purely in individual self-interest ultimately promote the social interest by creating an outcome that benefits society efficiently and fairly?
Key principles are: Trade-offs, Rational Choice, Opportunity Cost, Marginal Analysis and incentives
marginal analysis, which means evaluating choices on the margin by comparing Marginal Benefit (MB) against Marginal Cost (MC).
entire process is driven by incentives,
Social Scientists: Develop models and test positive statements (testable facts "what is") against real-world data using experiments and stat analysis.
Policy Advisers: Apply economic tools to evaluate trade-offs and guide decisions using normative statements (value judgments about "what got to be).
Competitive Market: A market with many buyers and sellers where no single person can dictate price, giving consumers many options and forcing sellers to adapt to demand and supply.
Price changes, Price of related goods (substitutes and complements), expected future prices, income, preferences, and population size.
Income:
Normal Goods: Income rises people demand more
Inferior Goods: Income rises people demand less (ex dollarama food)
Price, technology, input prices, expected future prices, number of suppliers, state of nature, and prices of related goods
Inputs : Making goods more expensive Supply decreases
Technology: Makes production cheaper
Prices of Related Goods Produced: Shifts production toward higher-profit alternatives
Prices adjust to balance quantity demanded and supplied, reaching equilibrium where quantity demanded equals quantity supplied.
Quantity demanded exceeds quantity supplied, causing prices to rise until equilibrium is restored.
Quantity supplied exceeds quantity demanded, causing prices to fall until equilibrium is restored.
When both curves shift in the same direction, quantity changes predictably; when opposite, price changes predictably; magnitude determines ambiguous variable.
Price elasticity of demand = % change in quantity demanded / % change in price.
Closeness of substitutes, proportion of income spent, time since price change, and whether the good is a luxury or necessity.
Income elasticity of demand = % change in quantity demanded / % change in income.
Responsiveness of demand to changes in income, indicating if a good is a normal or inferior good.
Cross elasticity of demand = % change in quantity demanded / % change in price of a substitute or complement.
How demand for one good responds to price changes of related goods (substitutes or complements).
Elasticity of supply = % change in quantity supplied / % change in price.
Resource substitution possibilities and time frame (momentary, short-run, long-run supply responses).
Predicting double shifts in Demand and Supply
Same way Shift: When both shift in same way , equilibrium Quantity moves predictably that direction, while equilibrium Price is ambiguous (determined by curve with larger shift).
Opposite way Shift: When curves move opposite way, equilibrium Price moves predictably, equilibrium Quantity is ambiguous