Assignment 1
Length: 3 pages; *Not Including Title and reference*; APA; Double-spaced 12pt Times New RomanTitle: Economic Analysis
Introduction
What models do economists use to examine economic behavior and the economy?
What is the purpose of a possibilities curve?
Production Possibilities means?
Consumer Goods and Capital Goods
Below is a production possibilities table for consumer goods (butter) and capital goods (guns).
Production Possibilities
Type of Production Production Alternative A Production Alternative B Production Alternative C Production Alternative D Production Alternative E Production Alternative F Production Alternative G
Butter 0 1 2 3 4 5 6
Guns 14 13 11 9 7 4 0
• Graph the data provided in the table using Excel. (Hints: Type your data into an Excel spreadsheet. With your mouse, highlight the data only. Go to insert. Click on scatter. Click on smooth lines chart. Select the line chart. Plot data drawing line.)
• Once you have graphed the data, please copy and paste your graph into a Word document so you can complete the rest of the assessment.
Based on the graph you created, complete the following:
1. Analyze the graphed data to develop assumptions, referencing the possibility curve.
2. Identify the specific assumptions that underlie the production possibilities curve.
3. Determine the cost of more butter, if the economy is at point C.
• What would be the cost of producing more guns?
• How does the shape of the production possibilities curve reflect the law of increasing opportunity costs?
• Suppose this hypothetical economy were producing only 1 item of butter and 10 guns, and this was depicted by this production possibilities table and curve. What conclusions could you draw about this economy's resource utilization?
• Determine whether this economy is able to produce outside its current production possibilities. How might technological changes affect the production possibilities curve? How can international trade allow consumption above its production possibilities curve?
Opportunity Cost
1. Analyze the concept of opportunity cost.
2. Explain what is meant by opportunity cost.
3. Explain how opportunity cost relates to the definition of economics.
4. Determine if allocating advertising expenditures to boost sales or investing in a new plant and equipment would entail the greater opportunity cost. Explain and support your response.
Marginal Cost v Marginal Benefit
1. Apply the concept of marginal cost and marginal benefit to real world decisions.
2. Provide two examples of recent decisions you made in which you, either explicitly or implicitly, weighed marginal cost and marginal benefit.
Conclusion
Reference Page3 references needed
Assignment 2
Length: 3 pages; *Not Including Title and reference*; APA; Double-spaced 12pt Times New RomanTitle: Economic Analysis.
Title: Growth Analysis
Introduction
Why do you think macroeconomics focus on just a few key statistics when trying to understand the health and trajectory of an economy?
Would it be better to try and examine all possible data?
High Growth Impact
Consider a nation in which the volume of goods and services is growing by 5% per year:
• Analyze the impact of the high rate of growth on the nation.
• Explain how the high rate of growth is likely to affect the power and influence of the nation's government relative to other nations experiencing slower rates of growth.
• Explain how the 5% growth is likely to affect the nation's living standards. How does economic growth affect population growth?
• Will living standards necessarily grow by 5%, given population growth?
Gross Investment vs Net Investment
• Use the concepts of gross investment and net investment to explain the differences between an economy that has a rising stock of capital and one that has a falling stock of capital.
• Explain how it is impossible for gross investment to be less than zero, even though net investment can be positive, negative, or zero. What real world examples can you provide?
Economic Discrepancies
• Analyze the economic discrepancies between countries.
• Explain why some countries today are much poorer than other countries.
• Based on what you know and have learned about macroeconomic principles, are today's poorer countries destined to always be poorer than today's wealthy countries?
• If so, explain why.
• If not, explain how today's poorer countries can catch up to or even surpass today's wealthy countries.
Recessions
• Explain how, in general, a financial crisis can lead to a recession.
• Explain how, in general, a major new invention can lead to an economic expansion.
Conclusion
Reference Page 3 references needed