Homework: Intro of Economics
Part 1
I. Most automobile drivers probably exceed the legal speed limits somewhat when they think they can get away with it. Does this imply they would vote for higher speed limits if given a chance?
II. Each of the 10 families on a suburban block is likely to have its own power lawn mower. Why don't families more often share a single lawn mower? Try to enumerate the principal transaction costs that stand in the way of such a cooperative arrangement.
III. Do the relative salaries of humanities professors and football coaches at major state universities reflect the relative value of football and humanities? Do they reflect the number of years that professors and coaches must spend acquiring an education? The number of hours they work? The difficulty or unpleasantness of their work? Why do the football coaches usually receive salaries that are so much higher, often even higher than the university president?
IV. Should high school history and English teachers be paid as much as science and math teachers?
i. Suppose a school district pays all high school teachers with the same years of experience the same salary, regardless of teaching field, and that this produces a surplus of history and English teachers, and a shortage of science and math teachers. Would this create a case for salary differentials?
ii. How could the problem of concurrent surplus and shortage be solved without paying science and math teachers more than history and English teachers?
iii. Why has the policy of identical wages in fact produced shortages of science and math teachers, along with surpluses of history and English teachers in many school districts? What factors have contributed on the demand side? On the supply side?
Part 2
I. Does a junk dealer contribute to GDP? What about a fine-antique dealer? How? Why?
II. During the most recent recession-the so-called Great Recession-the United States government increased the amount of time an individual was eligible for unemployment benefits from a maximum of 26 weeks to a maximum of 99 weeks. How is this likely to change the incentives facing the unemployed? (To be eligible for unemployment benefits, one must be "looking for work" and not have refused "suitable work") What might this do to the unemployment rate measured in the economy in general?
III. Today, most of our monetary transactions are done with plastic or via bank apps, all of which are easily tracked. Even craft vendors at small town festivals use apps on their smart phones and tablets to accept cashless payments. Some argue that actual bills and coins are no longer necessary in today's world except in cases where illegal goods and services are being exchanged. Do you agree or disagree with this? Could our society be cashless? How could you give your niece $25 for her birthday? What behaviors would have to change for that to occur? Who would resist, and why? Who would benefit? What would the risks and/or rewards be of be cashless?
IV. Adam Smith complained in The Wealth of Nations that many people confused money with wealth. Is this accurate?
i. Doesn't a person's wealth increase when he or she acquires more money?
ii. If any one person's wealth increases when he or she acquires more money, doesn't it follow logically that more money for everyone means more wealth for everyone?
iii. What would happen if the government of India tackled the problem of poverty by printing more rupees and distributing them generously to the poorest people in the country?
Format your homework according to the give formatting requirements:
1. The answer must be double spaced, typed, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the homework, the course title, the student's name, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The references and Citations should follow APA format. The reference page is not included in the required page length.