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Reading notes: 10 Principles of Economics by Mankiw  

2009-12-21 21:27:11|  分类: Reading notes |  标签: |举报 |字号 订阅

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Chapter 1:

 

 

1: People face tradeoffs. Acknowledging life’s tradeoffs is important because people are likely to make good decisions only if they understand the options that they have available.

2: The cost of something is what you give up to get it. Do not neglect the opportunity cost!

3: Rational people think at the margin. A rational decisionmaker takes an action if and only if the marginal benefit of the action exceeds the marginal cost.

4: People respond to incentives.

5: Trade can make everyone better off.

6: Markets are usually a good way to organize economic activity.

7: Governments could sometimes improve market outcomes. Market failure could be caused by an externality or market power. And a goal of many public policies is to achieve a more equitable distribution of economic well-being.

8: A country’s standard of living depends of its ability to produce goods and services.

9: Prices rise when the government prints too much money.

10: Society faces a short-run tradeoff between inflation and umemployment.

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