chapter 1 Flashcards
(13 cards)
1
Q
agents
A
are decision makers
consumers and firms
2
Q
exogenous variable
A
variable outside
3
Q
endogeneous variable
A
insdie economic model
price and quantity
4
Q
constrained optimization
A
best choice
5
Q
objective function
A
what agent cares about
6
Q
constraints
A
limits placed on resources avalaible to agent
7
Q
qs = qd is …
A
equilibrium
8
Q
comparative statics analysis
A
change in some exogenous vari affect endogenous variable
bad weather means cant grow crops and decline in sales
9
Q
positive analysis
A
what will happen or what is happening
9
Q
explanatory or predicitve questions are also…
A
positive analysis
9
Q
normative analysis
A
what should be done
10
Q
prescriptive questions are also …
A
normative
11
Q
A
