Principles of Economics

Principle 1

People Face Trade-Offs

Principle 2

The Cost of Something is What You Give Up To Get It (Opportunity Cost)

Principle 3

Rational People Think At The Margin

Principle 4

People Respond To Incentives

Principle 5

Trade Can Make Everyone Better Off

Principle 6

Markets Are Usually a Good Way to Organise Economic Activity

Principle 7

Governments Can Sometimes Improve Market Outcomes

Principle 8

A Country's Standard of Living Depends on Its Ability to Produce Goods and Services

Principle 9

Prices Rise When the Government Prints Too Much Money

Principle 10

Society faces tradeoff between inflation and unemployment