1. Nine Principles of Economic ThinkingNine Principles of Economic Thinking
Everything has a costEverything has a cost
People choose for good reasonsPeople choose for good reasons
Incentives matterIncentives matter
Economic actions carry secondary effectsEconomic actions carry secondary effects
People gain from voluntary tradePeople gain from voluntary trade
Economic Thinking is marginal thinkingEconomic Thinking is marginal thinking
The price of a good or service is affected byThe price of a good or service is affected by
people’s choicepeople’s choice
People create economic systems to influencePeople create economic systems to influence
choice and incentiveschoice and incentives
The test of a theory is its ability to predictThe test of a theory is its ability to predict