Page number 1
1
, Page number 2
2
,Principles of Economics 8th Edition Test Bank & Study Notes |
N. Gregory Mankiw | Complete Questions & Answers
Page number 3
Chapter 1/Ten Principles of Economics ❖1
1
TEN PRINCIPLES OF ECONOMICS
WHAT’S NEW IN THE EIGHTH EDITION:
There is a new case study “Adam Smith Would Have Loved Uber.”
LEARNING OBJECTIVES:
By the end of this chapter, students should understand:
➢that economics is about the allocation of scarce resources.
➢that individuals face trade-offs.
➢the meaning of opportunity cost.
➢how to use marginal reasoning when making decisions.
➢how incentives affect people’s behavior.
➢why trade among people or nations can be good for everyone.
➢why markets are a good, but not perfect, way to allocate resources.
3
, Chapter 1/Ten Principles of Economics ❖2
➢what determines some trends in the overall economy.
Page number 4
CONTEXT AND PURPOSE:
Chapter 1 is the first chapter in a three-chapter section that serves as the introduction to the text.
Chapter 1 introduces ten fundamental principles on which the study of economics is based. In a broad
sense, the rest of the text is an elaboration on these ten principles. Chapter 2 will develop how
economists approach problems while Chapter 3 will explain how individuals and countries gain from
trade.
The purpose of Chapter 1 is to lay out ten economic principles that will serve as building blocks for
the rest of the text. The ten principles can be grouped into three categories: how people make decisions,
how people interact, and how the economy works as a whole. Throughout the text, references will be
made repeatedly to these ten principles.
4
1
, Page number 2
2
,Principles of Economics 8th Edition Test Bank & Study Notes |
N. Gregory Mankiw | Complete Questions & Answers
Page number 3
Chapter 1/Ten Principles of Economics ❖1
1
TEN PRINCIPLES OF ECONOMICS
WHAT’S NEW IN THE EIGHTH EDITION:
There is a new case study “Adam Smith Would Have Loved Uber.”
LEARNING OBJECTIVES:
By the end of this chapter, students should understand:
➢that economics is about the allocation of scarce resources.
➢that individuals face trade-offs.
➢the meaning of opportunity cost.
➢how to use marginal reasoning when making decisions.
➢how incentives affect people’s behavior.
➢why trade among people or nations can be good for everyone.
➢why markets are a good, but not perfect, way to allocate resources.
3
, Chapter 1/Ten Principles of Economics ❖2
➢what determines some trends in the overall economy.
Page number 4
CONTEXT AND PURPOSE:
Chapter 1 is the first chapter in a three-chapter section that serves as the introduction to the text.
Chapter 1 introduces ten fundamental principles on which the study of economics is based. In a broad
sense, the rest of the text is an elaboration on these ten principles. Chapter 2 will develop how
economists approach problems while Chapter 3 will explain how individuals and countries gain from
trade.
The purpose of Chapter 1 is to lay out ten economic principles that will serve as building blocks for
the rest of the text. The ten principles can be grouped into three categories: how people make decisions,
how people interact, and how the economy works as a whole. Throughout the text, references will be
made repeatedly to these ten principles.
4
