Ten Key Principles of Economics

1. Everything has a cost. There is no free lunch. There is always a trade-off.
2. Cost is what you give up to get something. In particular, opportunity cost is cost of the tradeoff.
3. One More. Rational people make decisions on the basis of the cost of one more unit (of consumption, of investment, of labor hour, etc.).
4. Incentives work. People respond to incentives.
5. Open for trade. Trade can make all parties better off.
6. Markets Rock! Usually, markets are the best way to allocate scarce resources between producers and consumers.
7. Intervention in free markets is sometimes needed. (But watch out for the law of unintended effects!)
8. Concentrate on productivity. A country’s standard of living depends on how productive its economy is.
9. Sloshing in money leads to higher prices. Inflation is caused by excessive money supply.!!
10. Caution: In the short run, falling prices may lead to unemployment, and rising employment may lead to inflation.



Showing posts with label Trade Offs. Show all posts
Showing posts with label Trade Offs. Show all posts

Wednesday, July 28, 2010

Eye On Obesity Reduces Anti-Smoking Efforts

In a classic trade-off, America's health policy priorities are shifting pulling money away from anti-tobacco programs and directing it toward the obesity issue. The consequences may be a compromise that slows the momentum of declining loyalists to nicotine. Should the federal government be involved in these personal choice matters to begin with? Or, is this the front line of defense against runaway healthcare costs?
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Wednesday, July 21, 2010

Paradox Of Choice



If you can get past this guy's outfit, you'll find this to be a very relevant and intriguing presentation.
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Saturday, July 17, 2010

The War On Drugs

The War on Drugs
Via: Medical Coding Certification
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