Principles of Microeconomics Essay

WEEK 1 ECO 204 NEW Week 1 Quiz 1.Question :In economics, scarcity means that Student Answer: there are not sufficient resources to produce everything that people want. poverty will always exist. a country can never feed all of its citizens. the price of a good may increase more rapidly than the general price level. there is not enough of a particular good for people to buy all they want at the prevailing price. Points Received:1 of 1 Comments: 2.Question :If beans are inferior goods, a decrease in income will Student Answer: cause beans to sell at a lower price. increase the production of beans. shift the demand curve for beans to the left. shift the demand curve for beans to the right. rotate the supply curve in a clockwise manner. Points Received:1 of 1 Comments: ECO 204 NEW Week 1 DQ 1 Circular Flow Diagram Explain how the circular flow diagram relates to the current economic  situation. Using the circular flow diagram, explain a way that your family interacts in the factor market and a way that it interacts in the products market. ECO 204 NEW Week 1 DQ 2 Supply and Demand Analyze how the law of demand applies to a recent purchase that you made. Describe how the product has changed in price and explain whether the price change is due to supply or demand. Did the change in price affect your decision to purchase the item? WEEK 2 ECO 204 NEW Week 2 Raise or Lower Tuition: Nobody State University Tuition Universities must constantly weigh tuition pricing in relation to the cost of providing quality educational services. Determining where to set tuition pricing is an increasingly critical decision which administrators and university presidents must analyze when considering the university’s goals. Not only does the cost of tuition play a factor in student enrollment, it also provides a major revenue source to an institution. The question which universities must answer is, â€Å"What effect will raising or lowering the university’s tuition have on the total earned revenue? This paper investigates this question and reviews under what conditions a change in tuition prices will cause the revenue to rise, fall, or remain constant. Finally, applying a hypothetical tuition elasticity coefficient of demand for education value of -1.2, provides a tuition increase recommendation to the Nobody State University’s president and administration board based upon the university’s potential revenue impact. ECO 204 NEW Week 2 DQ 1 Elasticity Analyze the determinants of the price elasticity of demand and determine if each of the following products are elastic or inelastic: †¢bottled water †¢toothpaste †¢cookie dough ice cream †¢fresh green beans †¢gasoline In your analysis, please make sure to explain your reasoning and relate your answers to the characteristics of the determinants of the price elasticity of demand. ECO 204 NEW Week 2 DQ 2 Externalities Explain the difference between a positive and negative externality. In your analysis, make sure to provide an example of each type of externality. Why does the government need to get involved with externalities to bring about market efficiency? What solutions need to be provided for your examples? WEEK 3 ECO 204 NEW Week 3 Quiz 1.Question :When the marginal product curve is declining because of Student Answer: increasing returns, the marginal cost curve is rising. diminishing returns, the marginal cost curve is rising. diminishing returns, the marginal cost curve is falling. diminishing returns, the marginal cost curve is constant. increasing returns, the marginal cost curve is falling. Points Received:1 of 1 Comments: 2.Question :A firm that owns a wheat farm, a grain elevator, a flour mill, a commercial bakery, and a grocery store chain is Student Answer: horizontally integrated. vertically integrated. a monopoly. an imperfect competitor. a conglomerate. Points Received:1 of 1 Comments: ECO 204 NEW Week 3 DQ 1 Short and Long Run Let’s assume that you own a fast food restaurant and you are faced with many customers each day eating in the restaurant without any tables. Describe the difference between the short run and long run in the example to bringing about more tables for the customers. How is the restaurant able to differentiate between the short run and long run? ECO 204 NEW Week 3 DQ 2 Fixed and Variable Costs After reading Chapter 8 in the text and viewing the required video for this week, Fixed, variable, and marginal cost,address the following in your initial post: †¢First, describe several different fixed costs and variable costs associated with operating an automobile. †¢Next, assume that you would like to travel from Los Angeles to New York City by either car or plane. Which costs would you take into account in making your decision, fixed costs, variable costs or both? Make sure to explain your analysis in the decision that you have to make. WEEK 4 ECO 204 NEW Week 4 Quiz 1.Question :All but which one of the following are true of monopolistic competition? Student Answer: MR = MC P>MC AR = MR The demand curve the firm faces slopes downward. Entry is easy. Points Received:1 of 1 Comments: 2.Question :At the point of long-run equilibrium for a perfectly competitive firm, Student Answer: economic profits are zero. TR > TC. TR < TC. P = AVC. normal profits are zero. Points Received:1 of 1 Comments: ECO 204 NEW Week 4 DQ 1 Market Structures Explain the most important characteristic in perfect competition, monopolistic competition, oligopoly, and monopolies and relate the characteristic to how these firms can make profits in the short run. In your analysis, make sure to relate an example for each of the market structures listed and how it relates to the particular characteristics. ECO 204 NEW Week 4 DQ 2 Barriers to Entry Analyze the major barriers for entry and exit into the airline industry. Explain how each barrier can foster either monopoly or oligopoly. What barriers, if any, do you feel give rise to monopoly that will allow the government to become involved to protect consumers? WEEK 5 ECO 204 NEW Week 5 DQ 1 Transfers: Why would cash transfers typically be preferred by recipients over in-kind transfers? What are the pros and cons of each from a government perspective? Respond to at least two of your classmates ECO 204 NEW Week 5 DQ 2 Tariffs and Quotas: Who gains and who loses from a tariff? How do the effects of tariffs differ from the effects of quotas? If you were a small country, what would you rather utilize? ECO 204 NEW Week 5 Final Paper Importance of Economic Market Structures Before an organization or investor makes a strategic decision to enter a product in today’s economy, a thorough market analysis is vital to fully comprehend the domestic and international demand, current suppliers, entry and exit barriers present, and cost of production for the product or service being provided. The culmination of this investigation identifies the market structure the product resides in, associated potential long-run profitability, cost efficiency, survivability, and incentives for future entrepreneurs. This paper will describe the characteristics of four such market structures: perfect competition, monopolistic competition, oligopoly, monopoly while providing an illustrative example of each. The paper further describes the competitive pressures with high entry barriers, preferred selling and buying markets, projected reaction to price changes for elastic and inelastic goods, government intervention and the expected effect of international trade on economic ma rkets. Understanding how a product and associated production firm fits into an economic market structure is vital to investors as it impacts the firm’s motivations, opportunities and business strategies. A successful economic analyst identifies the attributes of the applicable market structure, then using the known market assumptions predicts the implicit and explicit costs of production and projected market outcomes. However, in order to accurately classify the correct market structure, the economic analyst must first be aware of the defining attributes of each market. The paper next describes  the characteristics of a perfect competition, monopolistic competition, oligopoly, and monopoly market structure.