“The 10 Things In Economics That Everybody Should Know”


This: list: gets about 2.5 out of 10 correct. A better list:

1. People want far more at zero prices than they can possibly produce: goods and services have been, are, and almost surely always will be scarce.

2. People respond to incentives.

3. The cost of doing something is the value of the next best alternative foregone. (On the list.)

4 Sunk costs are sunk. (Or, sunk costs should be ignored in making decisions.)

5. Voluntary trade is mutually beneficial. (On the list.)

6. Market s are least-cost allocatiion mechanisms.

7. Future cash flows are worth less than nomimally equivalent current cash.

8. Inflation is, everywhere and always, caused by excessively high money growth.

Trending on the Web
Craig Newmark

Craig Newmark

Associate Professor of Economics, North Carolina State Univ.

Related Articles

0

Urge Congress to Vote ‘NO’ On Striking $$ Saving Section From Federal Construction Projects Bill

Today there may be a vote on striking a section of H.R. 2055 that will insure that federal construction projects

2

Chicago: Union Members Collect Millions in Tax $$ With Sweetheart Pension Deal

Now this is the sort of corruption we are used to seeing in Illinois, eh? This week the Chicago Tribune

12

What the GOP Pledge Reflects and Why We Need To Stand By It

: : : : : : : : : : :  When the Pledge to America was first announced, it immediately met backlash from the other side of the aisle.