Aggregate demand

Freakonomics can be seen as the study of economics based on the principle of incentives. In the movie, Steven Levitt and Stephen Dubner gives multiple examples of how incentives govern our thoughts and actions and its role in economics. The first example explored was the unlikeliness of a house agent to wait to sell a client house for a higher price. The simple reason is the low incentive. If the agent was to wait another week to sell the house for a price that is only 10k higher, they would get…

good job of debunking this “labor fallacy”. From Wheelan’s explanation, I learned that every new job does not necessarily come at the expense of a job lost somewhere else. When new people enter the workforce, they create new demand within the economy thereby creating demand for other new jobs. This helped me to be able to better understand and explain why immigration can be a benefit to the job market rather than a detriment to American…

1. Of the 10 values described in Schwartz's Value Theory, is there one or two that best describe your own personal values? Which one(s) and why? Can you point to how this value(s) has directly impacted a major decision or action you have taken in your life? The Schwartz’s value aligned with my personal values would be Self-Direction. Self-Direction is independent thought and action; choosing, creating, exploring, which are happenings I apply ongoing. Growing up, change was constant in my life…

of company especially for Low End and Traditional segment. We invested on TQM in 2020 that kept to reduce Able and Acre’s material costs that to increase our contribution margin as well as to assure the flexibility of the pricing to fit the market demand. 5.1.3 Ideal Position. High End customers are more focused on Performance and Size of a product. However, Andrews did not get expected profits on the High End segment in the first few years; therefore, we abandoned the High End segment and…

Competitive force – one can notice that Delanghe became superior in his filed of agriculture. This could be seen in various awards, which were obtained including Lifetime Achievement Award, Red Delicious apples, and Kent County Agricultural Fame. These awards prove that Delanghe’ product exceeded expectations of the buyers and turned to be more innovative that their competitors. In such business, where the product is demanded and the quantity supplied is high, the only way to be competitive is…

can choose to give more chips at the same price, drop the price of chips, or keep the price the same in case of future price rises. 3. Supply and demand Two of the most important factors affecting your price are supply and demand. 10. Supply. The amount of a product or service that businesses provide at a given time and a given price. 11. Demand. The amount of a product or service customers are willing and able to buy at a given time at a given…

Pareto optimality is a tool used by normative welfare economist who measures welfare in terms of preference satisfaction. This tool is used for assessing social welfare, resource allocation and to analyze public policy. It was a principle proposed by Italian economist and sociologist, Vilfredo Pareto in order to make high levels of inequality justifiable. An allocation is said to be a Pareto improvement if no alternative allocation could make at least one person better off while not making…

Consumerism. The drive which makes us feel like we need everything, no matter what the eventual costs and problems would create. “Swollen Expectations,” an article that looks into the effects of consumerism and different ways it has changed our lives, claims that our generation sets higher material expectations than any other generation. Some will argue that this isn’t the case, and that our world is changing for the better. However, I would disagree with those arguments. After discussing the…

Intertemporal preferences describe the way consumers make decisions between how much food they would consume today versus how much food they would consume tomorrow. The consumption of today would influence the consumption of food tomorrow. Some basic assumptions for intertemporal preferences are transitivity, consumer prefer more over less, and consumers can choose between two alternative streams (today versus tomorrow). A decision requires a trade off by the consumers between costs and benefits…

Marginal Utility underlies the Law of Demand because it includes the additional utility that can be received by a consumer. Consumers want to receive the maximum utility of a product and this creates the Law of Demand. 4) Define and explain Elasticity. Be sure to explain any terms. Elasticity is how economists measure a good’s sensitivity to a change in price or quantity. It answers the question of “does the price of this product affect its demand?” Luxuries tend to be elastic while…