2. 1 - 1 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show The Nature and Method of Economics 1 C H A P T E R

3. 1 - 2 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show The Economics Perspective SCARCITY & CHOICE Consider...

4. 1 - 3 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show The Economics Perspective SCARCITY & CHOICE RATIONAL BEHAVIOR Consider...

5. 1 - 4 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show The Economics Perspective SCARCITY & CHOICE RATIONAL BEHAVIOR MARGINAL ANALYSIS Consider...

6. 1 - 5 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show The Economics Perspective Consider... Marginal Benefits & Marginal Costs SCARCITY & CHOICE RATIONAL BEHAVIOR MARGINAL ANALYSIS

7. 1 - 6 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show WHY STUDY ECONOMICS plus many modern contributors... Adam Smith David Ricardo John Stuart Mill Karl Marx John Maynard Keynes Economics for Citizenship Professional & Personal Applications

8. 1 - 7 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show ECONOMIC METHODOLOGY Scientific Method Hypothesis Testing Theory Law Principles Models

9. 1 - 8 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Theories Facts Policy Economics Theoretical Economics ECONOMIC METHODOLOGY

10. 1 - 9 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Analytical Economics Terminology Generalizations ECONOMIC METHODOLOGY

11. 1 - 10 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Analytical Economics Terminology Generalizations Other-Things-Equal ceteris paribus ECONOMIC METHODOLOGY

12. 1 - 11 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Analytical Economics Terminology Generalizations Other-Things-Equal ceteris paribus Abstractions ECONOMIC METHODOLOGY

13. 1 - 12 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Analytical Economics Terminology Generalizations Other-Things-Equal ceteris paribus Abstractions Graphical Expression ECONOMIC METHODOLOGY

14. 1 - 13 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show ECONOMIC POLICY STATING GOALS POLICY OPTIONS EVALUATION

15. 1 - 14 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show What are our goals and objectives? ECONOMIC GOALS

16. 1 - 15 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Economic Growth Full Employment Economic Efficiency Price-Level Stability Economic Freedom Equitable Distribution Economic Security Balance of Trade ECONOMIC GOALS

17. 1 - 16 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show MACROECONOMICS...

18. 1 - 17 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show MICROECONOMICS... MACROECONOMICS...

19. 1 - 18 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Positive Economics Absolute Facts Normative Economics What Ought to be MICROECONOMICS... MACROECONOMICS...

20. 1 - 19 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Biases Loaded Terminology PITFALLS TO OBJECTIVE THINKING

21. 1 - 20 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Biases Loaded Terminology Definitions PITFALLS TO OBJECTIVE THINKING

22. 1 - 21 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Biases Loaded Terminology Definitions Fallacy of Composition PITFALLS TO OBJECTIVE THINKING

23. 1 - 22 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Biases Loaded Terminology Definitions Fallacy of Composition Causation Fallacies PITFALLS TO OBJECTIVE THINKING

24. 1 - 23 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show Biases Loaded Terminology Definitions Fallacy of Composition Causation Fallacies Post Hoc Fallacy PITFALLS TO OBJECTIVE THINKING

25. 1 - 24 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show PITFALLS TO OBJECTIVE THINKING Biases Loaded Terminology Definitions Fallacy of Composition Causation Fallacies Post Hoc Fallacy Chapter Conclusions

26. economics economic perspective marginal analysis scientific method theoretical economics principles generalizations other-things-equal assumption policy economics tradeoffs macroeconomics aggregate microeconomics positive economics normative economics fallacy of composition “after this, therefore because of this” fallacy ENDBACK Copyright McGraw-Hill/Irwin 2002

27. 1 - 26 Copyright McGraw-Hill/Irwin 2002 The Economics Perspective Why Study Economics Economic Methodology Macroeconomics and Microeconomics Pitfalls to Objective Thinking Key Terms Previous Slide Next Slide End Show THE ECONOMIZING PROBLEM CHAPTER 2 COMING SOON