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Hey guys, today we're solving problem number 18 from chapter 2 the textbook, which asks, what are the four responses to the claim that people should not behave in the way described in this chapter? so i picked out the sections that most directly state those four reasons.
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I'm going to highlight each one in a different color, and then i'll give a bit of an explanation for each.
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So i'll highlight the first one in green, the second one in blue, the third one in red, and fourth one black.
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So it says first, economics is not a form of moral instruction.
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Rather, it seeks to describe economic behavior as it actually exists.
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So as it actually exists would be through positive statements and normal statements are how the world should be.
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So the idealism part is not economic.
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Economic seeks to describe behavior as it actually exists.
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So basically economics is to make a lot of positive statements about changes in the stock market and economic behavior.
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It's factual in nature, true, false, and you can test them at least in principle.
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That's super important.
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All right.
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The second reason is that we can label self -interested behavior and profit -seeking with other names, such as personal choice and freedom.
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The ability to make personal choices about buying, working, and saving is an important personal freedom.
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So that is another reason.
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This is another response to the claim that people should not behave in the way described.
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Because you can label certain things like self -interested behavior and profit seeking as freedom and personal choice or personal choice and freedom respectively.
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And they give you examples...