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Intro.
- Positive analysis (how the word is)
Normative analysis (how the world
should be)
- Arbitrage: buying at a low price at
one location and selling it at a
higher price in another.
- (Perfectly) Competitive market:
Many buyers and sellers so that
they don't have a significant
impact on price.*
- The extent of a market: boundries of a
market, both geographical and in terms
of range of products produced and sold
within it.
- Nominal price: unadjusted for inflation.
Real price: adjusted for inflation.
- CPI (consumer price index)
PPI (producer price index)
- CPI(where you want to go)/CPI (where you are) x nominal price (where you are)
Media attachments
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