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Ten Principles of Economics

TEN PRINCIPLES OF
ECONOMICS
How people make decisions.
PRINCIPLE1 : People face tradeoffs.
PRINCIPLE2 :The cost of something is
what you give up to get it.
PRINCIPLE :Rational people think at the
margin.
PRINCIPLE
4:
People
respond
to
incentives.

TEN PRINCIPLES OF
ECONOMICS
How people interact with each other.
PRINCIPLE5:Trade can make everyone
better off.
PRINCIPLE6: Markets are usually a good
way to organize economic activity.
PRINCIPLE7:
Governments
can
sometimes
improve
economic
outcomes.

TEN PRINCIPLES OF
ECONOMICS
The forces and trends that affect
how the economy as a whole works.
PRINCIPLE8: The standard of living
depends on a countrys production.
PRINCIPLE9: Prices rise when the
government prints too much money.
PRINCIPLE10: Society faces a short-run
tradeoff
between
inflation
and
unemployment.