...Chapter 1 Thinking Like an Economist Answers to text questions and problems Answers to Review Questions 1. Your friend probably means that the benefits from private solo lessons are greater (your tennis game will improve faster) than if you take group lessons. But private lessons are also more costly than group lessons. So those people who don’t care that much about how rapidly they improve may do better to take group lessons and spend what they save on other things. (LO2) AACSB: Analytic Bloom’s: Analyze 2. False. According to the Cost-Benefit Principle, your willingness to make the trip should depend only on whether $30 is more or less than the cost of driving downtown. (LO4) AACSB: Analytic Bloom’s: Analyze 3. Because the price of a movie ticket is a cost the patron must pay explicitly, it tends to be more noticeable than the money that she would fail to earn by seeing the movie. As Sherlock Holmes recognized, it’s easier to notice that a dog has barked than that it has failed to bark. (LO5) AACSB: Analytic Bloom’s: Analyze 4. Using a frequent flyer coupon for one trip usually means not having one available to use for another. By thinking of frequent-flyer travel as free, people fail to consider the opportunity cost of using the coupon, thereby making wasteful travel decisions. (LO2) AACSB: Analytic Bloom’s: Analyze 5. Your tuition payment is a sunk cost as long as it is non-refundable, since the payment cannot be recovered even if you...
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...There are _ Roles an _ plays2, Economist Economist Role #1:As a Scientist Economist Role #2:As a Policy Advisor How is an Economist and a Scientist alike?They work together to EXPLAIN the world. How is an Economist and a Policy Advisor alike?They work together to IMPROVE the world. What method do both Economists and Scientists use to explain the World?The Scientific Method; through Observation, Theory and more Observation. What are Assumptions?Statements that help simplify the complex world, making it easier to interpret and understand. What are Models?Simplified representations Economists use to help understand the complex reality. The Production Possibilities Frontier and Circular Flow Diagram are:The Main models Economists use to portray and represent the Closed Economy. The Circular Flow Diagram contains 2 Actors (Decision Makers):1) Households 2) Firms The Circular Flow Diagram contains 2 Markets:1) Goods and Services 2) Factors of Production What are the roles of Firms?PRODUCE Goods and Services, Using Inputs: Labour, Land from Natural Resources and Capital such as buildings and machines. The Inputs that the Firms use from are also called:The Factors of Production, Raw Materials, from Resources What roles do the Households play?They OWN the Factors of Production, and CONSUME the Goods and Serviced produced by the Firms. What is "special" about the Households?They have the ability to CONTROL and OWN every single Firm...
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...Even small decisions have the potential to cascade with unintended consequences throughout an organization. That’s why business executives should actively engage with one another around the trends captured in this report. Many leading organizations are already having these crucial conversations. They recognize that now is the time to get ahead of the trends by making more informed decisions. The seven Human Capital Trends for 2013 provide a solid checklist for getting started. Welcome to annual report examining significant trends in human capital.Human Capital Trends 2012 Leap ahead 3 Contents Thinking like an economist 4 The open talent economy 8 Innovating the talent brand 11 Creating an elastic workplace 14 Finding the silver lining in the talent gap 17 Debunking the Superman myth 20 The performance management puzzle 23 4 1 Thinking like an economist Increasingly, many HR leaders have to answer questions that have...
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...Principles of Economics (week 1) Thinking Like an Economist (week 1) Supply and Demand (week 2) Market Efficiency (week 3) Consumer Surplus (week 2) Your assignment for the final paper is to write a 2 to 3 page paper (double spaced) about how 3 of the above concepts applies to your daily life. For example how does consumer surplus impact the decisions you make when shopping for groceries? Be creative and think hard about these important concepts. Please use ProQuest and cite at least one source in text. Your paper will be due on Saturday night of the last week of the module. Submit your paper to Smarthinking. Attach their feedback along with your final submission. Smarthinking has about a 48 hour turn-around time so plan accordingly. Day to Day Concepts Perla Gomez ECN220 September 7, 2013 Sheneman Day to Day Concepts The thought of Economics can be a scary one. It is full of big words, difficult concepts, and challenging theories that can be hard to understand. The concepts that underlie Economics are scary ones and at some point were difficult to understand. However, I found that I could apply most of these concepts to my daily life. Supply and Demand, Consumer Surplus, and Thinking Like an Economist are all part of my day to day activities. I use them so often that I don’t even realize I am using them or taking advantage of them. Even if you have no idea what these are, chances are you have already used them, like me. According to my Economics...
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...“It is More important to discover new ways of thinking about what is already known than to discover new data or facts”. This great dilemma, which the question is based on, is in choosing between discovering new ways of thinking about what is already known and discovering new data or facts, is quite a complicated task. Before I begin, the terms “new ways of thinking”, “facts”, and “data” must be defined. According to various dictionaries, data is defined as a series of observations, measurements, or facts; information is defined as an event which is known to have happened that can be verified through experience or observation. The phrase “new ways of thinking”, seems more ambiguous because how can there be new ways of thinking? However, for this essay, the definition of thinking from a different perspective or thinking in a way that is different from all previous ways of thinking is used. This, however, allows different people to have different new ways of thinking. A new way of thinking to one person would no longer be the same to another person. Most often, people would firmly say that new ways of thinking are innovative and new advances are advantageous; for example, in Economics, advances in technology would lead to a greater productive and allocative efficiency, which would result in greater levels of economic growth for a certain country, which, of course, it’s a great benefit for the society. However, there is also a need for discovery new data and facts to broaden our...
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...apologize for your inconvenience. Best regards, Joseph Niehl Baron *********************************************************** Chapter II: Thinking like an Economist Principle of Economics 1. Every field has it’s own language and it’s own way of thinking. 2. The Economist as Scientist a. Economists two roles: Scientists / Policy advisors b. Devise theories, collect data, analyze data to verify or refute c. Scientific method: Observation and theory 3. Assumptions and models a. Assumptions can simplify the complex world and make it easier to understand b. Use models to learn about and illustrate the world. c. First model: The circular flow diagram: is a visual model of the economy that shows how dollars flow through markets among households and firms. d. Second model: The production possibilities frontier: is a graph that shows the various combinations of output that the economy can possibly produce given the available factors of production and the available production technology 4. Microeconomics and Macroeconomics a. Microeconomics: is the study of how households and firms make decisions and how they interact in market b. Macroeconomics: is the study of economy wide phenomena including inflation, unemployment, and economic growth 5. The Economist as Policy Maker a. Positive VS normative analysis: Positive statements are claims that attempt to describe the world as it is. Normative statements...
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...Licensed to: CengageBrain User Licensed to: CengageBrain User This is an electronic version of the print textbook. Due to electronic rights restrictions, some third party content may be suppressed. Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. The publisher reserves the right to remove content from this title at any time if subsequent rights restrictions require it. For valuable information on pricing, previous editions, changes to current editions, and alternate formats, please visit www.cengage.com/highered to search by ISBN#, author, title, or keyword for materials in your areas of interest. Copyright 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it. Licensed to: CengageBrain User Economics for Today © 2012 Cengage Learning Australia Pty Limited 4th Edition Allan Layton Copyright Notice Tim Robinson This Work is copyright. No part of this Work may be reproduced, Irvin B. Tucker stored in a retrieval system, or transmitted in any form or by any means without prior written...
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...Topic 1, write a 1-page paper that applies four of the eight guideposts of economic thinking to government spending and taxation Well from reading this week reading, the economic way of thinking requires more than just making decisions on plain information. For it requires government incorporating certain guidelines such as the building blocks of basic economic theory into their thought process when making decisions. There are eight principles that characterize the economic way of thinking; however, I will only identify four. According to the textbook” “One of the first guidelines is referred to as the use of scare resources is costly, so decision-makers must make trade-offs. Economists sometimes refer to this as the “there is no such thing as a free lunch” principle, it is important to recognize that the use of scarce resources to produce a good is always costly” (Gwartney et.al, 2013). In economics, the opportunity cost of an action is the highest valued option that is given up when choices are made in economic thinking. 2. When government make decisions, they should make decisions on the margin of how much it is going to cost and which option seems like the most economical way. “When making a choice between two alternatives, individuals generally focus on the difference in the cost and benefits between alternatives. Economists describe this process as marginal decision-making, or thinking in such cases” (Gwartney et al, 2013). 3. Having information on the economic factor...
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...Class-1 Ten Principles of Economics Economy. . . . . . The word economy comes from a Greek word-Oekonomous- for “one who manages a household.” Any similarity between household and economics? Copyright © 2004 South-Western/Thomson Learning TEN PRINCIPLES OF ECONOMICS • A household and an economy face many decisions: • Who will work? • What goods and how many of them should be produced? • What resources should be used in production? • At what price should the goods be sold? Copyright © 2004 South-Western/Thomson Learning TEN PRINCIPLES OF ECONOMICS Society and Scarce Resources: • The management of society’s resources is important because resources are scarce. • Scarcity. . . means that society has limited resources and therefore cannot produce all the goods and services people wish to have. Copyright © 2004 South-Western/Thomson Learning TEN PRINCIPLES OF ECONOMICS Economics is the study of how society manages its scarce resources. Copyright © 2004 South-Western/Thomson Learning TEN PRINCIPLES OF ECONOMICS • How people make decisions. • • • • People face tradeoffs. The cost of something is what you give up to get it. Rational people think at the margin. People respond to incentives. Copyright © 2004 South-Western/Thomson Learning TEN PRINCIPLES OF ECONOMICS • How people interact with each other. • Trade can make everyone better off. • Markets are usually a good way to organize economic activity. • Governments can sometimes improve...
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...to buy what you want in terms of other goods or services. When economists use the word "cost," we usually mean opportunity cost. The word "cost" is commonly used in daily speech or in the news. For example, "cost" may refer to many possible ways of evaluating the costs of buying something or using a service. Friends or newscasters often say "It cost me $150 to buy the iPhone I wanted." Definitions and Basics Opportunity Cost, from the Concise Encyclopedia of Economics When economists refer to the "opportunity cost" of a resource, they mean the value of the next-highest-valued alternative use of that resource. If, for example, you spend time and money going to a movie, you cannot spend that time at home reading a book, and you can't spend the money on something else. If your next-best alternative to seeing the movie is reading the book, then the opportunity cost of seeing the movie is the money spent plus the pleasure you forgo by not reading the book.... Getting the Most Out of Life: The Concept of Opportunity Cost, by Russ Roberts on Econlib To get the most out of life, to think like an economist, you have to be know what you're giving up in order to get something else.... Sometimes people are very happy holding on to the naive view that something is free. We like the idea of a bargain. We don't want to hear about the hidden or non-obvious costs. Thinking about foregone opportunities, the choices we didn't make, can lead...
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...make decisions and how they interact in markets Macroeconomics- the study of economy-wide phenomena, including inflation, unemployment, and economic growth Positive Statements- claims that attempt to describe the world as it is Normative Statements- claims that attempt to prescribe how the world should be The Economist As Scientist Economists view subject with objectivity devise theories, collect data, analyze data use scientific method The Scientific Method: Observation, Theory, And More Observation interplay between theory and observation experiments difficult in economics: have to look to history allows us to examine present and predict future The Role Of Assumptions economists make assumptions to make the world easier to understand two countries, two goods applying correct assumption to right data different assumptions for short0run and long-run effects of a change in the quantity of money Economic Models models not often real but are accurate and helpful economists use diagrams and equations omit details to show what’s truly important models are built with assumptions Our First Model: The Circular-Flow Diagram simplifies our thinking about economic activities explains generally how economy is organized and how participants interact two types of decision makers (households and firms) inputs=factors of production markets for goods and services vs markets for factors of production outer loop=corresponding flow of dollars excludes roles of gov...
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...Abstract In this assignment, Principles of Economics, I will state my answer to the following six questions: First I will suggest how an economist would approach the problem of alcohol abuse. I will provide two possible solutions to this problem, while including the four (4) elements of the economic way of thinking in my analysis. Second, I will analyze how prescription drugs affect the demand and supply of other products and services in this country. Third, I will formulate a reason why the elasticity of demand is an important consideration when analyzing the impact of a shift in supply and why the elasticity of supply is an important consideration when analyzing the impact of a shift in demand, while including at least one (1) example in each scenario. Fourth, I will provide two (2) examples of increasing-cost industries in your state and propose why they would have a positively sloped supply curve. Finally, I will suggest how, under certain conditions, a perfectly competitive market is economically efficient. Principles of Economics Alcohol Abuse Alcohol abuse is a major problem in today’s society. With a down an economy, there are more and more people turning to alcohol while actually helping the local package store to thrive. Economist may see it differently. They may see it as a way; first they will “Use Assumptions to Simplify”. (O'Sullivan, A., Sheffrin, S. M., & Perez, S. J. (2012)) Why are these people drinking? Is it because they struggle...
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...colossal losses have made scholars to beam their searchlight on this neglected aspect of corporate governance. The nonchalance with the way some CEOs handle the process of succession planning not only puts their companies in jeopardy, but also signposts a major criterion on which outgoing CEOs and their executive board members will be evaluated. Before we proceed, we will issue a caveat: the practice of succession planning runs ahead of the theoretical understanding of the process. In fact, in the course of this research, we did not come across a single work on charismatic leaders. However, we did come across pockets of literature on CEOs and succession planning. It is from these literature and articles from reputable magazines like the Economist, Forbes and the Wall Street Journal that we extrapolated our...
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...Aggregate Supply and Demand Model Kelly Guerrero, Kayla Levett ECO/372 June 18, 2013 Esperance Namugabo Aggregate Supply and Demand Model The Aggregate Supply and Demand model is driven by several factors, including non-price level factors or determinants can cause a change in the aggregate demand (“Colander, D. C.” 2010). Independent buying depends on the amount of money the individual maintains, what is expected from the money while spending, job security, and individual taxes. Investment spending and government spending are also a part of the model. The majority of Americans do not understand the true state of the economy. Currently, the United States consumes more than it produces monthly; meaning that the country is getting poorer every month. Individuals are not in tune with the events happening on a national level. During this expansion the expectations of the United States were not as hopeful as pervious expansions. Because of the current recession, the gross domestic product or GDP is not as high as past growth. The GDP beginning in 2008 was only 2.5% with a continual growth of 2% annually. This is lower than the previous expansion ending in 2007 that was 4%. This affects individual consumers, public sector spending, military spending, and government spending. (Reddy, 2013) During the Obama administration, recession recovery was slowly on the rise. Consumer spending rose 3.2% but cutback on saving money. Congress also passed a legislation...
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...Artificial Intelligence and The Future of Humanity Artificial intelligence is the human-like intelligence demonstrated by machines and man made software. The artificial intelligence field is interdisciplinary meaning that it combines two or more academic disciplines or fields of study, in which a number and professions mesh together, including computer science, psychology, linguistics, philosophy and neuroscience, as well as other specialized fields such as artificial psychology. Major artificial intelligence researchers and textbooks define this field as the study and design of intelligent agents, where as an intelligence agent is a system that checks out its environment and takes the necessary actions that maximizes the chances of success(Artificial Intelligence, A.G. Cohn, R. Dechter). Now, this person John McCarthy, who coined the term in 1955, defined it as the science and engineering of making intelligent machines. Artificial intelligence research is very highly technical and specialized, and is deeply divided into sub fields that usually often fail to communicate with each other. Some of the division is due to social and cultural factors meaning that it will or will not function because of our multicultural race. Some sub fields have grown up around particular institutions and the work of individual researchers. Artificial intelligence research is also divided by several technical issues. Some sub fields focus on the solution of specific problems. Others focus on one...
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