The models are used to generate hypotheses about the economy that can be tested using real-world data.. Statements of fact and hypotheses are positive statements.. Normative statements,
Trang 1Attributed to Libby Rittenberg and Timothy Tregarthen Saylor.org
been widely tested often comes to be regarded as a theory; one that has
won virtually universal acceptance is a law Because of the complexity of
the real world, economists rely on models that rest on a series of
simplifying assumptions The models are used to generate hypotheses
about the economy that can be tested using real-world data
Statements of fact and hypotheses are positive statements Normative
statements, unlike positive statements, cannot be tested and provide a
source for potential disagreement
PROBLEMS
1 Why does the fact that something is scarce require that we make
choices?
2 Does the fact that something is abundant mean it is not scarce in the
economic sense? Why or why not?
3 In some countries, such as Cuba and North Korea, the government
makes most of the decisions about what will be produced, how it will
be produced, and for whom Does the fact that these choices are
made by the government eliminate scarcity in these countries? Why
or why not?
4 Explain what is meant by the opportunity cost of a choice
5 What is the approximate dollar cost of the tuition and other fees
associated with the economics course you are taking? Does this dollar
cost fully reflect the opportunity cost to you of taking the course?
6 In the Case in Point essay “The Rising Cost of Energy,” what would be
some of the things that would be included in an estimate of the
opportunity cost of preserving part of northern Alberta Canada by
prohibiting heavy crude oil extraction? Do you think that the
increased extraction represents the best use of the land? Why or why
not?