unit 1: important questions\nwhat are the 7 principles of economics?\nwhat is the \invisible hand\?\ngive an…

unit 1: important questions\nwhat are the 7 principles of economics?\nwhat is the \invisible hand\?\ngive an example of the \invisible hand\ at work.\nunit 2: definitions and topics\ngdp\n o memorize formulas. be able to calculate this.\nbusiness cycle\n o understand all parts.\n o what affects the business cycle?\ninflation\n o understand all definitions.\n o what causes inflation?\nunemployment\n o understand all types.\n o be able to identify who is counted as officially \unemployed\ and who not.\npoverty\nfiscal policy\n o contractionary\n o expansionary\n o supply side economics\n o surplus\n o deficit\nmonetary policy\nunit 2: models and graphs\nyou should be able to draw/label the following models and graphs\nbusiness cycle

Answer

Brief Explanations:

The text covers fundamental economic concepts like the 7 Principles of Economics, the "invisible hand", GDP, business cycle, inflation, unemployment, poverty, fiscal and monetary policies. These are core topics in the field of Economics, which studies the production, distribution, and consumption of goods and services.

Answer:

What are the 7 Principles of Economics? These principles generally cover concepts like incentives, trade - offs, opportunity cost etc. and form the basis of economic decision - making.
What is the "invisible hand"? Coined by Adam Smith, it refers to the self - regulating nature of the market where supply and demand interact to allocate resources efficiently.
Give an example of the "invisible hand" at work: In a free - market for smartphones, consumer demand for high - quality, affordable phones prompts producers to innovate and compete, leading to better products at lower prices over time.
GDP: Gross Domestic Product is the total value of all final goods and services produced within a country in a given period. It can be calculated using the expenditure approach (GDP = C + I+ G + NX), income approach or production approach.
Business Cycle: It consists of phases like expansion, peak, contraction, and trough. Factors such as changes in consumer spending, investment levels, and government policies can affect it.
Inflation: A general increase in prices and fall in the purchasing value of money. Causes can include demand - pull (excess demand), cost - push (rising production costs) and built - in inflation (wage - price spiral).
Unemployment: Types include frictional (short - term between jobs), structural (mismatch between skills and jobs), cyclical (due to business cycle), and seasonal. Officially unemployed are those who are jobless, actively seeking work, and available for work.
Poverty: A state of lacking sufficient resources to meet basic needs.
Fiscal Policy: Contractionary fiscal policy involves reducing government spending or increasing taxes to slow down the economy. Expansionary fiscal policy is the opposite, aiming to stimulate economic growth. Supply - side economics focuses on policies to increase production capacity. Surplus occurs when government revenue exceeds spending, and deficit when spending exceeds revenue.
Monetary Policy: Central bank actions to manage the money supply and interest rates to achieve economic goals like stable prices and full employment.
Business Cycle (Models and Graphs): Graphs typically show real GDP on the vertical axis and time on the horizontal axis, depicting the different phases of the business cycle.