Economic Methodology and the Economic Problem
What is the primary goal of economic methodology?
To provide a framework for understanding economic problems.
Which concept best defines the economic problem?
The scarcity of resources compared to unlimited wants.
What does 'positive economics' focus on?
Describing and explaining economic phenomena.
What is 'normative economics' primarily concerned with?
Evaluating economic policies based on value judgments.
What does the term 'opportunity cost' refer to?
The value of the next best alternative foregone.
Which of the following is a normative statement?
The government should provide free healthcare to all citizens.
What is the main focus of microeconomics?
The behavior of individual consumers and firms.
What is the 'ceteris paribus' assumption in economics?
Holding other factors constant while analyzing one variable.
What do economists mean by 'rational behavior'?
Individuals aim to maximize their utility or benefit.
What is the primary method used in empirical economic research?
Data analysis and statistical modeling.