Topic Two (1.2): Economic Methodology

Introduction Icon.png Introduction

In this topic you will learn how to explain why Economics is a social science. You will learn how to distinguish between facts and opinions. You will also understand the meaning of the Latin term ceteris paribus which is often used in Economics and learn what economists mean by time periods, which are referred to as short run, long run and very long run.

Skills Icon.png Task

Economics in Context

  • Read the headlines on page 10 of the textbook and identify economic terms and issues from the headlines.
  • Suggested answers can be found in the digital textbook and in General Resources.

Watch Icon.png Watch

  • Watch these videos, which explain Economics as a social science and the differences between positive and normative statements, and make notes.
  • The second video gives an interesting take on the meaning of ceteris paribus.

WATCH – Positive, Normative Statements and Economic Methodology (YouTube) Links to an external site.

WATCH – Ceteris Paribus: Public vs. Private University (YouTube) Links to an external site.

Read & Make Notes Icon.png Read and Make Notes

Read and supplement your notes from the following sections of the textbook on pages 10 to 13:

    • 2.1 What is economics?;
    • 2.2 Economics as a social science;
    • 2.3 Positive and normative statements;
    • 2.4 Meaning of the term ceteris paribus;
    • 2.5 The importance of time periods.

Glossary Icon.png Glossary

Highlight any new terminology on your glossary.

Skills Icon.png Task

Think Like an Economist

  • Read and complete the ‘Think like an Economist’ task on page 13 of the textbook. Try to look at both sides from viewpoints of UK and Japan.
  • Suggested answers can be found in the digital textbook and in General Resources.

Consolidate Icon.png Consolidate

  • Now try the exam-style questions on page 14 of the textbook.
  • Suggested answers can be found in the digital textbook and in General Resources.

Reflect Icon.png Reflect

  • Draw up a table like the one on page 14 of the textbook and complete the self-evaluation.
  • If there are any areas about which you are unsure, please go back over your notes, the textbook and the resources listed in this topic before moving on.