devry ECON-312 Principles of Economics all week discussions

Opportunity Cost (graded) |
Give an example of how the Principle of Opportunity
Cost applies to your life. Think of a recent decision you made. It could be a
decision as simple as whether to eat out or cook your own dinner, or it could
be a decision to quit your job and go back to school. What alternatives did you
consider? How did you arrive at your final decision? Did you implicitly weigh
marginal cost and marginal benefit? How does the concept of opportunity cost
apply to production possibilities curve (PPC) analysis? How can we use PPC
analysis to examine what we do?
Economic Systems (graded) |
Think of a business firm you recently visited (such as Walmart, Home Depot, Red Lobster, Barnes & Noble, McDonald’s, etc.). What motivated the producers of all the individual products in the store to make them and offer them for sale? How did the producers decide on the best combinations of resources to use? Who made those resources available, and why? How does the market determine who will get the goods and services? Who decides whether these particular products should continue to be produced and offered for sale? How do these decisions differ between capitalist and socialist systems?
week 2 discussion
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Think about a product that you have purchased
recently (e.g. soda, diapers, takeout meals, milk, shoes, manicure/pedicure,
video game, etc.). Explain how the law of demand affected your purchase. Give
specific examples of how the determinants of demand and supply affect this
product (T-I-P-E-N and P-R-E-S-T). What happens to the demand curve and the
supply curve when any of these determinants change? Give examples of scenarios
that would cause a change in demand versus a movement along the same demand
curve and supply curve for this product. Discuss the new equilibrium price and
quantity that result from these changes. Can you demonstrate some of these
changes graphically?
Price Elasticity of Demand |
Think of another good that you have purchased recently (or you could continue with the good you selected in TDA I). Be specific (e.g. is it breakfast cereal in general or Cheerios cereal specifically). If the price of this item increases, how would this affect the quantity of the good that you consume? Is the Demand for this good Price elastic or Price inelastic? Justify your classification by talking about the determinants of elasticity as they apply to this product. Say price is on the rise for this product and you are the manager of a store, would you be thrilled to be selling this product? Under what circumstances would you want to own a business that sells this product? In other words, how does an increase in price for this good affect your Total Revenue? Using specific examples, relate the concepts of Cross Elasticity and Income Elasticity to this product.
week 3 discussions |
A Firm’s Shut Down Decision (graded) |
Say you are the manager of a perfectly competitive firm selling a product. Your business is making a loss because total revenue is less than total costs. What would you do--shut down or continue to operate? Use hypothetical numbers to explain. Information you need to provide include--state the product you are selling, the price of the product, the quantity of the product you produce, fixed costs, total cost, figure out total revenue, total and average variable costs. Then go ahead and make your decision. Explain carefully why it makes better sense to shut down rather than continue to operate or to continue to operate rather than shut down, as the case may be. How do fixed costs play a role in your analysis? What is the difference between shutting down and going out of business?
Market Structure Classification (graded) |
Think about a firm that you have done business with
recently. What industry does this firm belong to? For example, McDonald's is a
firm in the fast food industry. What market structure would this industry fall
under? What are the names of other firms in this industry? Is it monopolistic
competition, oligopoly, monopoly, or perfect competition? Justify your
classification of the firm. Use the characteristics/features of the different
market structure to determine which market structure to classify your chosen
firm.
GDP (graded) |
Go to the Bureau of Economic Analysis website,
www.bea.gov, and access the BEA interactively by selecting "National
Accounts" and then "National Income and Product Account Tables."
Select "Frequently Requested NIPA Tables," and find Table 1.1.1 on
GDP. What is the current GDP growth rate for the U.S.? Examine the trend over
the past few years. What trends interest you? What stage of the Business Cycle
would the U.S. economy be in currently given the trends? Why might GDP not be
considered an accurate measure of economic well-being of a country? Identify at
least three limitations of GDP as a measure of economic well-being.
Unemployment and Inflation (graded) |
Go to the Bureau of Labor Statistics website,
www.bls.gov/news.release/empsit.toc.htm, and click on "Employment
Situation Summary" to get the most up-to-date summary of unemployment in
the U.S. or the "Employment Situation Summary Table A. Household data, seasonally
adjusted." What interests or surprises you about the summary table? How
does that rate compare with the rate in the previous month or quarter? Discuss
the differences in unemployment rates by gender, age, education, etc.
week 5 discussion
Aggregate Demand and Aggregate Supply (graded) |
Go to the BEA website www.bea.gov. On the left tab under Publications, go to the Interactive Data Tables. Select National Income and Product Accounts. From Table 1.1.6 and 1.1.7 examine all four components of GDP (C, I, G, and Xn). Which of these four components of AD declined the most during the 2007 and 2009 recession? Do you think an increase in government's spending (G) can boost the Aggregate Demand (AD) in a recession? Analyze why the economy may operate below full-employment GDP in the short run. How can the multiplier have a negative effect? What is the relationship between the multiplier and the marginal propensities? Explain.
Fiscal Policy (graded) |
Give an example of an event or incident that has taken place in the U.S. economy which has a major economic impact--be specific, e.g., 9/11 attack, natural disaster, rise or fall in oil prices due to OPEC policies, consumer optimism or pessimism about an expected economic expansion or downturn, increase in government spending on healthcare, tightening of the legal and institutional environment, and so forth. What effect would this event have on AD or AS, other things being constant? What would be the resulting effect on equilibrium price level? Explain. What will be the effect of the different tools of fiscal policy to stabilize the economy? Give an example of a built-in stabilizer and explain how it would work to reduce this rise or fall in the level of AD.
week 6 discussion
Money and Banking (graded) |
What factors led to the mortgage default crisis?
How did mortgage defaults affect banks involved in mortgage lending and
mortgage investing? Securitization? TARP? What do these mean? How did
mortgage-backed securities spread losses during the mortgage default crisis?
How does TARP illustrate the problem of moral hazard? What did the Federal
Reserve do during the financial crisis of 2008 and 2009? How did the recent
financial crisis affect the financial services industry? What are some of the
major provisions of the Wall Street Reform and Consumer Protection Act?
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What is the Federal Reserve (Fed) all about? Which Federal Reserve District Bank is closest to you? Who is the current Chairman of the Fed? Should the Fed remain independent from political authority or should the President and Congress have a say in their operations? Why? Why not? What is FOMC? What is the current Federal Funds Rate? How does the Fed implement monetary policy to manage the economy? At the last meeting of the FOMC, what was done to the federal funds rate--increased, decreased, or no change from previous meeting? Given the current state of the U.S. economy, should the Fed be using expansionary monetary policy or contractionary monetary policy? Why? Why Not?
week 7 discussion |
Free Trade (graded) |
Are you for or against free trade? Are you for or against NAFTA? What is the economic basis for trade? Explain the underlying facts that support free trade and give an example of a good that you purchased recently that is based on resource differences. What are some examples of goods that the U.S. has comparative advantage in producing? Take a look at the tag of the shirt/dress/pants you are wearing today. Where was it made? Anyone wearing “Made in America” items of clothing today? We sometimes hear people say “Buy American." Why don't we? What is the basis of international trade? What are the benefits and the costs? Under what conditions would you advocate for trade restrictions?
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What is happening to the value of the U.S. dollar
these days? What causes the value of the U.S. dollar to rise or fall? Who
demands U.S. dollar? Who supplies U.S. dollar? When we purchase German
products, does our demand for euro go up or down? What are freely floating
exchange rates all about, and how do they work? How can the falling U.S. dollar
impact your travel expenses? Why would a cheap dollar relative to other
nations' currencies be good or bad for U.S. trade?

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Solution: devry ECON-312 Principles of Economics all week discussions