Good morning everyone! Today, I will introduce something about the principles of economics. What I will share with you now is from a book called principles of economics written by Mankiw. Economics is the study of how society manages its scarce resources. Economists study how people make decisions: how much they work, what they buy, how much they save, and how they invest their savings. Economists also study how people interact with one another. For instance, they examine how the multitude of buyers and llers of a good together determine the price at which the good is sold and the quantity that is sold. Finally, economists analyze forces and trends that affect the economy as a whole, including the growth in average income, the fraction of the population that cannot find work, and the rate at which prices are rising. During studying the problems, economists found ten principles of economics.
Becau the behavior of an economy reflects the behavior of the individuals who make up the economy, we start our study of economics with four principles of individual Decision making.
They are
a) People face tradeoffs
b) The cost of something is what you give up get it
c) 人力资源三级Rational people think at the margin
d) People respond to incentives
As we go about our lives, many of our decisions affect not only ourlves but other people as well. The next three principles concern how people interact with one another.
They are
a) Trade can make everyone better off
b) 洋芋Markets are usually a good way to organize economic activity
蔬菜汤c) Governments can sometimes improve market outcomes
All the decisions and interactions together make up “the economy.” The last three princi
ples concern the workings of the economy as a whole.
They are
a) A country’s standard of living depends on its ability to produce goods and rvices
b) Prices ri when the government prints too much money
c) Society faces a short run tradeoff between inflation and unemployment
Now I want to introduce the three principles in the cond part.管理的职能
水浒传好词控烟手抄报The first one is Trade can make everyone better off.
We live better becau we trade. If we isolate from others, we would need would need to grow our own food, make our own clothes, and build our own home. Trade allows each person to specialize in the activities he or she does best, whether it is farming, wing, or home building. By trading with others, people can buy a greater variety of goods and rvices at lower cost. Countries as well as families benefit from the ability to trade with o
ne another. Trade allows countries to specialize in what they do best and to enjoy a greater variety of goods and rvices. Although maybe they are competitors, trade still makes them better off.
The cond one is Markets are usually a good way to organize economic activity.
Today, most countries that once had centrally planned economies are developing market economies. In a market economy, firms decide whom to hire and what to make, and houholds decide which firms to work for and what to buy with their incomes. In his 1776 book An Inquiry into the Nature and Caus of the Wealth of Nations, economist Adam Smith made the most famous obrvation in all of economics: Houholds and firms interacting in markets act as if they are guided by an “invisible hand” that leads them to desirable market outcomes. Prices are the instrument with which the invisible hand directs economic activity. Prices reflect both the value of a good to society and the cost to society of making the good. Becau houholds and firms look at prices when deciding what to buy and ll, they unknowingly take into account the social benefits and
costs of their actions. As a result, prices guide the individual decision makers to reach outcomes that, in many cas, maximize the welfare of society as a whole. Today I bring a short video about “invisible hand” and “visible hand”.
半身美女
Then let’s talk about the visible hand government. Governments can sometimes improve market outcomes.
There are two broad reasons for a government to intervene in the economy: to promote efficiency and to promote equity. That is, most policies aim either to enlarge the economic pie or to change how the pie is divided. The invisible hand usually leads markets to allocate resources efficiently. Nonetheless, for various reasons, the invisible hand sometimes does not work.离别前 Economists u the term market failure to refer to a situation in which the market on its own fails to allocate resources efficiently.
One possible cau of market failure is an externality. An externality is the impact of one person’s actions on the well-being of a bystander. For example, there is a chemical factory near your hou polluting the river day and night and you cannot get the clean wa
ter. Without the government, the factory would pay anything for pollution. And the cost of producing is less then what the factory cost.
