Econ 1110: Lecture 1 – Basic Principles of Economics

Flashcards covering core concepts from Lecture 1: Basic Principles of Economics, plus course logistics and policies.

What is Economics?

The science of decision making.

What does scarcity mean in economics?

Resources are limited; we can’t have everything we want.

What is the cost of something in economics?

What you give up to get it.

What is opportunity cost?

The value of the next-best alternative you gave up.

What does 'Choices are Necessary' mean?

Because resources are scarce, you must choose among options and sacrifice some.

What does 'On the Margin' refer to in decision making?

Decisions about how much more or less to do, comparing costs and benefits of a small increment.

What are incentives in economic behavior?

Things that motivate action; people respond to incentives.

What are gains from trade?

Trade can make everyone better off; specialization increases total output.

What is specialization in economics?

Different people focusing on different tasks to trade for other goods.

What does it mean that markets move toward equilibrium?

Prices adjust and trade continues until no further net gains from trade exist.

What is Pareto efficiency?

No one can be made better off without making someone else worse off.

What does the efficiency vs. equity footnote imply?

Efficiency doesn’t guarantee fairness; distribution matters and policy may aim to maximize total surplus.

What is the 'invisible hand' concept?

Self-interested actions by individuals can lead to overall efficient outcomes in markets.

When can the government help markets?

When markets fail due to externalities, market power, public goods, etc.

What is an externality?

A side effect of a market activity on others not reflected in market prices.

What is the role of prices in markets?

Prices motivate behavior and signal how much buyers value goods.

What is a 'resource' in economics?

Anything used to obtain something else.

What is Achieve in this course?

An online platform for homework with multiple tries; highest score counts; CAMP options apply.

Is attendance required in this course?

Attendance is not required, but it is rewarded.

What is the recommended study approach?

Explain concepts in your own words; writing by hand can improve retention.

What is the Active Learning Initiative (ALI)?

Two assessments (one mandatory, one optional); completing both adds 0.5% to final grade.

What is Poll Everywhere used for in this course?

Regular class polls that contribute to participation grade; usually 5 points across 24 relevant lectures.

What textbook is used for the course?

Microeconomics by Krugman & Wells; available as eBook via Achieve and affordable hard copies.

When are homework deadlines?

Deadlines are 11:59 pm Eastern; last-week reopening allowed for missed work; early assignments are practice.

How are exams scheduled?

Prelims on Oct 1 and Nov 5 (in class, on paper); final in December (date TBD; in person).