10 Principles of Economics

Principle 1

People face tradeoffs

Principle 2

the cost of something is what you give up (opportunity cost)

Principle 3

people think at the margin

Principle 4

People respond to incentives

Principle 5

trade makes everyone better

Principle 6

Markets are a good way to organize economic activity/set prices

Principle 7

governments can sometimes improve markets

Principle 8

a country’s standard of living depends on it’s ability to have a high GDP

Principle 9

prices increase when the government prints too much money

Principle 10

Society runs a trade off between inflation and unemployment