Основы экономики. Земскова Л.П. - 5 стр.

LECTURE 1.          WHAT IS ECONOMICS?

1. Economics is the study of how societies faced with the central problem of
   reconciling unlimited desires for goods and services with scarce resources
   that limit output decide what gets produce, how it is produced, and for whom
   it is produced.
2. Economics is studied for a variety of reasons: to understand problems facing
   the citizen and family, to help governments promote growth and improve the
   quality of life while avoiding depression and inflation, and to analyze
   fascinating patterns of social behavior. Because economic questions enter
   into both daily life and national issues, a basic understanding of economics is
   vital for sound decision making by individuals and nations.
3. Economists deal with both positive and normative questions. Positive
   economics seeks a scientific understanding of the workings of the economy;
   it deals with what is or could be. Normative economics offers prescriptions
   for action based on personal value judgements; it deals with what should be.
   The deepest disagreements among economists have to do with normative
   questions; most of positive economics is not controversial.
4. The production possibility frontier (PPF) shows the maximum amount of
   one good or service that can be produced for each given level of outputs of
   other goods and services. The PPF of any society will change if the quantity
   or quality of productive resources changes or if useful knowledge advances.
5. The PPF of an imaginary simple economy with only two possible outputs
   illustrates a number of basic economic principles. The opportunity cost of
   increasing the output of one of the goods is the amount of the other good that
   must be given up. Only the changes that a particular action would cause
   should be considered in evaluating its desirability; decisions should be made
   on the margin. In order to shift out the PPF, or make possible greater
   production tomorrow, society must reduce consumption today. Society is
   wasting resources if it is producing inside the PPF; it produces efficiently on
   the PPF. Points outside the PPF are unattainable because resources are
   scarce.
6. In a command economy, all decisions on “what” , “how” , and “for whom”
   would be made by the government. The government’s task in such an
   economy would almost certainly be impossible; at any rate, there are no real
   command economies.
7. At the other extreme, in a free-market economy, the government would play
   no role in the allocation of resources; the decisions of firms and households
   would interact through markets to make all the “what” , “how” , and “for
   whom” decisions. Adam Smith argued that individuals pursuing their own
   interests in free markets are led “as if by an invisible hand” to advance the
   interests of society as a whole. But there are no completely free-market
   economies; all real governments affect decisions about resource allocation in
   many ways and for many reasons.

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