Introduction to Economic Thinking

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Sherry A. Dailey

Phase 1 DB 2

Introduction to Economic Thinking

Colorado Technical University Online

Course: ECON 202

Instructor: Paul Napolitano

Date: 1/12/2013

The reality of scarcity is the conceptual foundation of economics. Understanding scarcity and its implications for human decision-making is critical to economic literacy – but that understanding is not easily achieved. As prices, increase healthcare economist should consider looking more into the actual cost of the tradeoffs. Undoubtedly, there is going to be a higher shortage of qualified medical personnel in upcoming years because of the rapidly rising cost of education. A quick glance at the programs cost to society, most people only consider the program’s budget. Salaries for physicians and nurse practitioners, expenses for other financial or accounting cost and educational brochures should appear with in the budget. However, such an examination of the budget ignores the programs economic cost or opportunity cost to the society, which in fact is what economist look for.

Marginal Analysis

Marginal Analysis is one of the most important concepts in microeconomics. Marginal analysis is defined as an examination of the additional benefits of an activity compared to the additional costs of that activity (Marginal Analysis, 2013). Economist utilizes marginal analysis as a decision making instrument to help them to maximize the profits by analyzing how a complex system in affected by compromising variables of marginal manipulation. Consider the following, at least up to some point the more health care that is consumed the higher the level of health of that particular individual. However the impact of that healthcare varies when an individual has poor levels of health, healthcare then has more impact on health than when they are healthy.

Normative versus positive

Economics is a very complex subject with many varying ideas to grasp....
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