Assignment:
Answer the following questions in 100 words or more, in your own words. Answers can be added under each question. Please include in-text citations, if any are used.
1. As you are reviewing the ten principles of economics, I would like for all of you to consider how connected and interdependent our economy really is, both domestically and internationally. For instance, having Wi-Fi has certainly led to the increase and growth in many products and industries. I can't even think of going a week without the Internet or checking my email! It has become part of who I am!
Think about the virtual world and how it has made things more integrated and international. When the Internet fails, think about how many 'business' in terms is lost (profits) and how limited we become with travel, purchases, communication and happiness! In your opinion, how has Wi-Fi access affected happiness/ utility? How has access to Wi-Fi altered our demand for other products? ie/ choosing a hotel with free Wi-Fi, buying a car because it has easier Wi-Fi capabilities, etc.
2. In this course, you need to THINK AS AN ECONOMIST.- But, what exactly does that mean and how is that done?
Well, first of all, you need to familiarize yourself with the economic 'talk'-- concepts/ theories/ notions, etc. (Doing your reading will certainly help). Next, you want to be able to apply the material and justify reasoning (logically) to everyday and common situations.
For instance: I'm not sure what State you all live in, but here in Michigan we have newspaper vending machines. You put in the coins (exact amount of money) and the door opens exposing you to all of the newspapers. 99% of the customer ONLY take one (as they should). However, there are snack vending machines that sell chips, candy, chocolate bars, soda for roughly the same price relative to the newspapers. However, the door to these vending machines do not open. Why is this the case? Can it have anything to do with marginal utility?
3. Many economists believe that trade= a win- win situation to all countries involved. The economy, the people, the industries and the government on both sides of trade would be better off. Do you agree? Disagree? Consider what is taking place in our current economy in terms of trade between the United States and its partners. Is there a win win situation taking place as most economists believe? Or is someone winning at the expense of someone else?
A few months ago, President Trump commented on limiting the amount of imports and restructuring trade in the USA. Economists and analysts disagreed with him and defended that his notion of trade is the 'biggest mistake' that he could do for the country. In your opinion, do we need a restructuring of trade and imports? Would it impact the growth and trade position for the country? Why? Why not?
4. You (as the student) can take the consumer side. However, there are students in this class that also have their own businesses or work for an employer and can take the side of a supplier. Perhaps you are one of those students!
Here is a quick snap shot of the justification:
- As prices increase the demand for the consumer (or student) will start to decrease. This is simply following the law of demand: price and quantity demanded have an inverse relationship.
- As a business owner (or supplier/ producer), the higher the price, the higher the quantity supplied. This does follow the law of supply where profits are attempted to being maximized.
- Can you think of examples in which this is most applicable? For instance: selling of food items, production of new technology, demand of new technology, demand of high-end clothing vs no-name clothing. In each case, consider the price point.
5. In economics we refer to government intervention as a Keynesian approach. The opposite is the Classical approach (no government intervention). When government intervenes into the economy, their aim is to balance or reset the equilibrium to the economy. While some would agree that there is need, others would disagree and indicate that there is no need (and that the economy would reset itself).
In my opinion (and research) I would have to stated that it would depend on the situation. Each economic is different and should be evaluated specifically in term of severity. Given your readings of the supply and demand concepts, what do you believe is the best most effective approach with government intervention in our current economy?
6. Consider how an economy coordinates the activities of millions of people with varying tastes and abilities.
7. Consider how supply and demand affects buyers and sellers behavior and how they interact with one another.
8. Consider how policies directly control prices.