Learning unit 1: What is economics

Economics

• Limited resources vs unlimited needs

• Limited needs vs limited wants

• Limited resources vs unlimited wants

• limited money vs the budge

Normative statement

• based on facts

• factual

• based on own opinion

• all correct

Opportunity cost

• is a results of making choices

• is the cause of scarcity

• is the same as choice

• is the cause of decision making

Economic goods

• are obtained free of charge

• are made from scarce resources

• are the same as public goods

• are also known as free goods

Inflation is discussed under

• macroeconomics

• microeconomics

opportunity cost

• outside the PPC

• inside the PPC

• slope of the PPC

• along the PPC

Economic growth

• shift of the PPC inwards

• no shift of the PPC

• the PPC will pivot

• Shift of the PPC outwards

Correlation

• Refers to a relationship between two variables where they move together in some way.

• means that one variable directly affects another. It implies a cause-and-effect relationship

Causation

• Refers to a relationship between two variables where they move together in some way.

• means that one variable directly affects another. It implies a cause-and-effect relationship

Level of change

• difference in the quantity of a variable from one period to another

• indicates by how much the level of change has increased or decreased from one period to the next.