Microeconomics

1.5 stratification (15 points) (1) Weber’s conception of stratification is derived from his analysis of economic activities in relationships. He said that economic relationships are decided by individuals’ chance of using their material property for exchange on the market. Thus, people sharing similar material conditions are classified into groups. In Weber’s view, the inequality between different groups is associated with not only the economic dimension but also social, political, and…

Explain the impact the law of diminishing marginal returns has on both marginal cost and average total cost MARGINAL COST Marginal cost is a total cost to the company to produce one more product. This cost changes depending on how many products the company aims to produce. Changes in production may increase or decrease the marginal cost due to the marginal cost including all costs such as materials, labour, infrastructure. Marginal cost diagram has a U-shaped curve as a result of increasing…

Economies of scale can be defined as the benefits that a firm obtains from the large-scale production reduced cost and increased profit. Sunk cost refers to the startup costs that a firm incurs when entering the market. Moreover, my research will discuss the significant barriers to soft drink business entry in the United States, which are economies of scale and sunk costs. Additionally, it will also look at how these restrictions have affected the soft drink market in the United States.…

Roger Arnold 's book How to think like an Economist has been a great help in understanding economics. Learning how to think as an economist has been quite interesting. The book made me realize that economics affects nearly every part of my life, something I really had not thought about. When thinking about this paper, I decided to share three areas of my life that involve interesting economic principles. These areas are my job, my car, and my hobby which is collecting books. There are a number…

Summary of “Economic Profit vs. Accounting Profit” Robert L. Bartley writes about the about how the economic and accounting versions of profit differ. While economists are interested in what creates production and thus profit, while accountants focus on the money earned for the owner. Most CEO and CFOs are follow the accountants definition, however they should be looking at the economists way, as it show the driving force behind the company’s production rate and profit. Summary of “America’s…

Elasticity is used in economics to measure the degree of responsiveness in demand in relation to an alteration in price or income. Economists use the term price elasticity of demand to express how much a change in price influences demand. Comparable, cross price elasticity determines the change in demand of one product with the increase or decrease in price on a different product. Similarly, income elasticity of demand intends to measure the change in demand after a change in consumers’ income.…

The neoclassical economic model gives an exceptionally fulfilling clarification of why parties are willing to join hands and enter into a contracts. Parties enter into contracts with their own free will without any coercion. Hence each party will enter into a contract only if its anticipated benefits are greater than the expected costs. For example assume that a house owner offers to pay a painter $5,000 to paint her home. The house owner must expect the value of the benefits she receives from…

Brand equity. What the client evaluates the brand 's estimation is, over its goal esteem; Retention equity The client 's propensity to stay with the brand notwithstanding when it is evaluated higher than a generally level with item; The procedure of client procurement is a progression of corporate activities for changing over outsiders or potential clients into colleagues or distinguished clients by starting an association with them. To finish this reason, an organization may investigate…

A monopoly is a market where the supply of a commodity is controlled by one firm who then becomes the single seller. Monopolies hold power over the market, meaning they can either set a fixed price or determine an output and then sell this output at the highest price the market will bear. The United States Postal Service is a natural monopoly, meaning they have large economies of scale that limit their costs of production and are large enough to efficiently supply the country with mail. Since…

The definition of Relational Dialectics Theory describes how relational life is described as an ongoing tension between contradictory impulses (199). However, the theory can benefit from economic terms as presented in Social Exchange Theory. Moreover, the theory could develop and explain how cost and rewards affect a relationship based on ongoing tensions. The two theories have similarities staring with their assumptions of rational life. Consequently, Relational Dialectics can use an…