Team #7 Padlet by

About me :

aqureshi21 — 2020-08-31 19:13:01 UTC

To contact me since I mainly check my phone my number is (903)-617-8935.I do check my school email but not as often but its AQureshi1@patriots.uttyler.edu.
Strengths I think I could bring to the team are organization, and creativity.
As far as expectations for my group members is just willing to participate, meeting on time if needed, and concise communication amongst one another.
Animoto: https://animoto.com/play/K2eAc193oZE5L1XNyYke0Q

About me :

kaseylw00 — 2020-09-03 18:54:17 UTC

You can always reach me at this current phone number, (936)-349-5773. Like Amana said I am not very good at checking my school email so the best way to contact me is using my phone number. But my school email is kwilliamson4@patriots.uttyler.edu
Some strengths I believe I can bring to the table would be is being a leader to my group members and be able to build them up. I expect full participation from my group because I have been on that team where it was just two of us doing all the work and it stinks.

https://animoto.com/play/XqTHjHtn8PQNnGtPcPf2Cg

About Me:

2020-09-04 19:52:09 UTC

My name is Logan Hernandez and I am a Sophomore majoring in Business Management after briefly majoring in Biochemistry.

To contact me by text or phone call, my number is (832)374-5472. To reach out to me by email, my Outlook is LHernandez14@patriots.uttyler.edu. I prefer Outlook because the app will always give me a notification if you reached out to me.

In a group setting, my strengths are being efficient in terms of communicating with all members of the group, ensuring we are making proper progress.

https://animoto.com/play/Jn6UFYX40rCaRUIaqf2Z0Q

Test 1 Topics and Overview:

aqureshi21 — 2020-09-24 06:05:36 UTC

Week 1 : The Economic Way of Thinking
a)PPC Problems
Week 2 : Fundamentals, Institutions, and the Market Place
a)Six Functions of Government
b)Circular Flow
Week 3 : Internal Trade
a)Comparative Advantage and Trade
Week 4 : Demand, Supply, and Changing Equilibrium
a)Notes Quiz
b)Market Game
Week 5 : Market Equilibrium, Policy, Efficiency, and Failure
a)Market Efficiency Government Failure

Fundamentals

aedwards194 — 2020-10-06 19:03:25 UTC

HW1 Notes:

aedwards194 — 2020-10-06 19:09:36 UTC

*Property rights are the exclusive right to decide how to use a resource
*A competitive market refers to a market with no externalities, many buyers and sellers, and free entry and exit.
*A market is a system where buyers and sellers interact to trade.
*Rule of Men: A system where the rules are enforced by the goodwill of the enforcer
*Rule of Law: A system where a society enforces property rights, contracts, and other rules based on a set of laws
*Rule of Force: "Might makes Right" A system where the strong enforce the rules according to their whim
*Specialization: Producing a single good or service rather than multiple goods and services
*Financial Institution: A firm that provides financial services, like accepting deposits and providing loans
*Entrepreneur: A person who organizes resources, like land, labor, and capital, to develop a new product or method of production, and assumes all of the risk
*Entrepreneurs:
-Maintain the innovations that often reduce costs and allow an economy to create more output with fewer resources
-Create completely new products and industries
-Put their money behind new businesses in markets that are already successful
*Formal markets are highly structured, while informal markets are less structured, with fewer rules
*Positive Externality: The benefit enjoyed by a third party that is not directly involved in the production or consumption of a good or service
*Negative Externality: The uncompensated cost of an activity that is imposed on a third party
*When people don't own the resources they use, they tend to under invest in them or overuse them

b)Circular Flow

aedwards194 — 2020-10-06 19:54:11 UTC

Circular Flow Models are a visual representation of how resources flow through the household, product market, business firms, and resource or factor market. Sometimes the Government is in the middle of the flow circle.

Six Functions of Government:

aedwards194 — 2020-10-06 19:58:25 UTC

1. provide legal and social framework within which the economy operates
2. maintain competition in the marketplace
3. provide public goods and services
4. redistribute income
5. correct externalities
6. take actions to stabilize the economy

Demand:

kaseylw00 — 2020-10-08 17:26:40 UTC

An economic principle referring to a consumers desire to purchase goods and services and willingness to pay a price for a good or service. Ashley, what effects demand is that prices drive the demand.

Government Failures:

kaseylw00 — 2020-10-08 17:30:28 UTC

An economic inefficiently caused by government intervention.

Market Failures:

kaseylw00 — 2020-10-08 17:30:28 UTC

An inefficient distribution of goods and services in the free market.

supply:

kaseylw00 — 2020-10-08 17:30:28 UTC

Refers to the amount of goods that are available to all. Ashley, the more products we produce would translate to more supply.

International Trade:

kaseylw00 — 2020-10-08 17:39:38 UTC

A basic economic concept involving the buying and also selling of goods and services, with compensation paid by a buyer to a seller, or the exchange of goods or services between the parties.

HW2 Notes:

aedwards194 — 2020-10-08 20:34:55 UTC

*"Trade creates Wealth"-Major theme in economics
*In a small-country model, the domestic price equals the world price if the country is open to trade
*In many of the examples of specialization and trade, it sometimes seems one country is getting a better deal, but if they are trading they must both be getting something out of it
*Specialization is based on relative opportunity cost, not absolute advantage
*When people specialize according to their comparative advantage overall production rises
*Comparative advantage is the foundation of establishing the benefits of trade
*In an economy of two goods, a country cannot have the comparative advantage in both goods
*Prices resulting from the market conditions ranked from highest to lowest:
1.domestic market with no international trade
2.a market with a quota
3.a free trade market
*Free Trade: Trade between nations without barriers
-examples of barriers include regulations tariffs, and quotas
-Barriers to trad have the same effect on the market as price floors
*Price floor- a government imposed limit on how low a price can be set
*Price ceiling- a government imposed limit on how high a price can be set
*Imports-Goods, services, or resources produced abroad and sold domestically
*Exports-Goods, services, or resources produced domestically and sold abroad

HW3 Notes:

aedwards194 — 2020-10-08 22:29:28 UTC

*Equilibrium quantity: Quantity supplied equals quantity demanded
*When a non-price determinant of supply changes the market adjusts to a new equilibrium price and quantity
*Non-price determinants are held constant for any given supply curve
*When a good or service is taxed in the market the quantity traded falls
*Binding price ceiling: A maximum legal price set below the equilibrium price
*Surplus: A situation in which the quantity supplied is higher than the quantity demanded
*Shortage: A situation in which the quantity demanded is higher than the quantity supplied
-Shortages persist if the price is not allowed to adjust upward
*Shortages and Surpluses are usually caused by price controls that do not allow markets to adjust or events that disrupt supply
*Taxes change the prices buyers and sellers pay and market outcomes
-Governments tax economic activity in order to pay for needed goods and services
*Excise tax: A tax on a good or service that depends on the units sold

HW4a Market Efficiency Notes:

aedwards194 — 2020-10-08 23:51:32 UTC

*The shortage of a good is calculated as the difference between the quantity demanded and the quantity supplied at a given price
-Shortage formula: Qs-Qd
*Consumer Surplus: the difference between the maximum price consumers are willing and able to pay for a good or service and the price they actually pay
-the area of consumer surplus is below the demand curve and above the equilibrium price
-example calculation-
1/2 *600*$60=$18,000
*Producer Surplus: the difference between the price producers receive for a good or service and the minimum price they are willing and able to except
-the producer surplus is the area below the equilibrium price and above the supply curve
-example calculation-
1/2 *600*$30=$9,000
*Total economic surplus: is the sum of consumer surplus and producer surplus
*A tax increases the cost of goods produced and shifts the supply curve up
*Some economic surplus is lost when a market is not allowed to adjust to equilibrium
*Deadweight loss: the value of the economic surplus that is forgone when a market is not allowed to adjust to equilibrium

HW4b Market Failures Notes:

aedwards194 — 2020-10-09 02:50:03 UTC

*A private good is rivalrous and excludable

*Excludable means it is possible to prevent consumers who have not paid for the good or service from accessing it
*rivalrous means
**The optimal level of pollution MB=MC (marginal benefit equals marginal cost)
*When the marginal cost of pollution prevention decreases, the equilibrium quantity of pollution prevention increases
*When the marginal cost of pollution prevention increases, the equilibrium quantity of pollution prevention decreases

Production Possibilities Curve

loganhernandez2019 — 2020-10-09 03:14:04 UTC

In Economics, the acronym PPC is used to refer to Production Possibility Curves. This concept consists of a down-sloping curve on a graph to represent a tradeoff between two options.

(NOTE: THE GRAPH WILL ALWAYS BE INVERSE WITH A NEGATIVE SLOPE!)

PPCs utilize Marginal Analysis, the cost/benefit decision-making of choosing a little more of one at the cost of a little less of the other.

PPC GRAPH OBSERVATIONS

loganhernandez2019 — 2020-10-09 03:41:41 UTC

Observe that on a PPC Graph, Capital Goods are always listed on the Y-Axis while Consumer Goods always take their place on the X-Axis.

b) Market Game

loganhernandez2019 — 2020-10-09 05:03:09 UTC

Remember the game that we played in class were the roles of buyers and sellers were assigned to students? As a buyer, the goal of each student was to purchase a product from a seller for either the same price listed on the card or less. As a seller, the goal of each student was to retail a product to the customer for either the same price listed on the card or higher.

Throughout the lesson, a general consensus was determined that $4 was the median price that customers were willing to pay, meaning anything below $4 was desirable to buyers and anything above $4 was unfavorable to buyers.

Throughout the lesson, new concepts were taught such as how improvements in technology could completely decimate the market for one product while opening up another market for the newer product.

Elasticity

loganhernandez2019 — 2020-10-09 12:31:12 UTC

Quantities Demanded and Quantities Supplied can be sensitive to changes in the variables that influence them. This is called Elasticity.

Demand is more elastic when:

• Many substitutes are available

• The product represents a large proportion of the budget

• The market is defined narrowly (think brand)

• There is more time to adjust to a change in price

• The good is a luxury versus a necessity

Supply is more elastic when:

• There is more time.

• Supply is especially influenced by time because productive resources are fixed in the short run.

• Supply is more elastic in the long-run because additional

resources can be obtained in the long-run.

Demand is more inelastic when:

• Few substitutes are available

• The product represents a small proportion

of the budget

• The market is defined broadly (think

product category)

• There is less time to adjust to a change in

price

• The good is a necessity versus a luxury

Supply is more inelastic

• The short-term because

productive resources are fixed in the short run.

• Supply is more elastic in the long-run because additional resources can be obtained in the long-run.

CALCULATING PRICE ELASTICITY OF DEMAND

loganhernandez2019 — 2020-10-09 12:45:00 UTC

DISTINCTIONS

loganhernandez2019 — 2020-10-09 12:48:26 UTC

Relatively Elastic Demand

• The upper portion of the demand curve

• Elasticity coefficient is >1

• % change in quantity demanded is greater than % change in price

• Numerator greater than

denominator

• Purchasers sensitive to price

Relatively Inelastic Demand

• The lower portion of the demand curve

• Elasticity coefficient is <1

• % change in quantity demanded

is less than % change in price

• Numerator less than

denominator

• Purchasers insensitive to price

Unit Elastic Demand

• The middle portion of the demand curve

• Elasticity coefficient is = 1

• % change in quantity demanded is equal to the % change in price

• Numerator same as denominator

• Purchasers respond

proportionally to change in to price

Perfectly Elastic Demand

• Hypothetically, can be perfectly elastic

• “E” for Elastic

ED = ∞

• Horizontal line – zero slope

• HOY (horizontal line, 0-slope, Y constant)

• Completely sensitive to price

• “Buyer’s Market”

• Perfect Competition

• Sellers can only control quantity supplied

• Sellers are price-takers

• Buyers determine price

Perfectly Inelastic Demand

• Hypothetically, can be perfectly inelastic

• “I” for Inelastic -

ED=0

• Vertical Line – Undefined slope

• VUX (vertical line, undefined slope, X

constant)

• Completely Insensitive to price

• Seller’s Market

• Monopoly (market power)

• Need it or it is inconsequential to budget

• Sellers control price

• Buyers determine quantity

ADDITIONAL ELASTICITY EQUATIONS

loganhernandez2019 — 2020-10-09 13:09:30 UTC

Income Elasticity of Demand

- %age change in Quantity demanded divided by %age change in income

- Normal and Inferior Goods

Cross-Price Elasticity of Demand

- %age change in Quantity demanded of one good divided by %age change

in price of another good

- Substitutes have positive CPE

- Complements have negative CPE

Price Elasticity and Tax Incidence

- Assumes Government doesn’t care whether buyers or sellers pay the tax!

Marshmallow Test

aqureshi21 — 2020-10-09 16:12:20 UTC

https://www.youtube.com/watch?v=QX_oy9614HQ
This video represents how our economy can make choices, but it is better to wait for a better opportunity cost to have an overall economic surplus.
Marginal Analysis and the PPF
- scarcity, choice, and opportunity cost
- two options can be measured on two axes of a graph.
- Efficient choices
- down sloping curve, represents the trade-off between two options. - negative or inverse
-consider opportunity cost.
-Marginal analysis is the cost/benefit decision, and rationality.

Go over example problems, and why graphs are linear, which has the advantage graphed, and understanding opportunity costs. Understand the initial points and why some axis' remain unchanged.

Six Functions of Government Real World Examples :

aqureshi21 — 2020-10-09 16:39:51 UTC

To elaborate on what Ash posted on the six functions here are 6 real life examples to get a better understanding.
1. Maintain the legal and social framework
- The federal government controls money circulating in the economy, so regulating banks, prevents bartering.
2. Maintain Competition
- Create and enforce anti-trust laws
Example is when the government charges companies higher prices, if they are producing products of poor quality to prevent monopolies.
3.Provide Public Goods and Services
- national defense, roadways, post offices and mail carriers, lighthouses, public defenders, public health clinics, public schools, and other important goods and services
4. Correct for Externalities
- Consider negative externalities and positive externalities. "Spillover" to third parties either buyers or sellers. Example is pollution, it affects lakes and rivers due to factories and production.
- the government then steps in and regulates pollution.
- consider social benefit MSB>MPB and MSC>MPC
5. Stabilize the Economy
- Reduce unemployment and inflation to promote economic growth
- •of fiscal policy [by raising or lowering taxes, or by government spending] and monetary policy [by controlling the money supply or by changing interest rates]. Without these actions, the economy might take much longer than it ordinarily does to recover from recessions.
6. Redistribute Income
- •Redistribution usually involves higher tax rates for people with higher incomes. The tax revenue raised in this way helps to pay for various welfare programs, the Medicaid program, legal defense clinics, etc. Some people could not afford basic necessities without government redistribution programs.

About me :

aedwards194 — 2020-10-09 16:42:20 UTC

You can usually contact me by phone at (909)-670-9534. I also check my school email at least once a day which is aedwards19@patriots.uttyler.edu. Please let me know what the email is about and who you are, or the email could be overlooked.

Strengths I can offer the team are a dedication to success, organization, communication, teamwork, and an upbeat and motivational attitude. I will do my part no matter what role I am asked to play in the group, and I will be flexible in order to accommodate my groups overall needs.

https://animoto.com/play/W9sRnbloGKaYJqjusMiP9g

Comparative Advantage and Trade :

aqureshi21 — 2020-10-09 17:07:54 UTC

The video from the power-points is good to look over.
Absolute Advantage

•is when a producer can produce a good or service in greater quantity for the same cost, or the same quantity at lower cost, than other producers.

Comparative Advantage

•producing a particular good if they can produce that good at a lower relative opportunity cost or autarky price, i.e. at a lower relative marginal cost prior to trade.

Specialization

•is a method of production whereby an entity focuses on the production of a limited scope of goods to gain a greater degree of efficiency.

Trade

•involving the buying and selling of goods and services, with compensation paid by a buyer to a seller, or the exchange of goods or services between parties.

Interdependence

•the state of being dependent upon one another : mutual dependence

The Production Possibilities Curve

– a graph that shows all of the different combinations of output that can be produced given current resources and technology. Sometimes called the production possibilities frontier (PPF), the PPC illustrates scarcity and tradeoffs.

Comparative Advantage

•others in producing a particular good if they can produce that good at a lower relative opportunity cost

Specialization

•a method of production whereby an entity focuses on the production of a limited scope of goods to gain a greater degree of efficiency.

Trade

•a basic economic concept involving the buying and selling of goods and services, with compensation paid by a buyer to a seller, or the exchange of goods or services between parties.

Interdependence

•a consequence of specialization or the division of labour. The participants in any economic system must belong to a trading network to obtain the products they cannot produce efficiently for themselves.

Benefits from Trade

• comparative advantage and absolute advantage

The Production Possibilities Curve

–In business analysis, the production possibility frontier (PPF) is a curve that illustrates the variations in the amounts that can be produced of two products if both depend upon the same finite resource for their manufacture.
Citation : Investopedia. (n.d.). Retrieved October 09, 2020, from https://www.investopedia.com/

Longterm Marshmallow Test Results-(addition to Amana's post)

aedwards194 — 2020-10-09 17:18:45 UTC

Researchers followed each child for more than 40 years and over and over again, the group who waited patiently for the second marshmallow succeed in whatever capacity they were measuring. In other words, this series of experiments proved that the ability to delay gratification was critical for success in life. Patience really is a virtue, I guess.

Cross price elasticity video

aedwards194 — 2020-10-09 18:29:25 UTC

In the video she keeps it simple stupid. I really enjoyed the graphics as well. I hope ya'll like it, too.

Underlying Concepts :

aqureshi21 — 2020-10-09 18:58:51 UTC

Understand Law of Demand and its two effects : Substitution Effect and Income Effect
Law of Supply
Market of Equilibrium
and the Importance of Ceteris Paribus
Surplus above equilibrium Qs>Qd - downward price pressure
Shortage below equilibrium - upward price pressure
Qs4 things that happen when a single curve shifts :
1.Demand increase
2.Demand Decrease
3.Supply increase
4.Supply decrease
- know how to graph these as well.

Economic Surplus of Markets, Government Intervention, Externalities and Spillovers

aqureshi21 — 2020-10-09 19:08:30 UTC

When looking at the Surplus of Markets consider the main points
-Consumer Surplus
-Producer Surplus
-Total Economic Surplus
What Happens to Economic Surplus when there is Economic Intervention?
When Price Floor is "can't drop below price"
- : There is a decrease in consumer surplus, a transfer of producer surplus to what used to be consumer surplus and the creation of deadweight loss.
When a Price Ceiling "can't go above price"
- : There is a decrease in producer surplus, a transfer of consumer surplus to what used to be producer surplus and the creation of deadweight loss.
Positive Externalities : MSB>MPB - government corrects this by subsidizing
Negative Externalities : MSC>MPC Government corrects this by fining and regulating overproduction

Utility and Satisfaction : Rational Decision Making, and Marginal Utility

aqureshi21 — 2020-10-09 19:24:22 UTC

Rational-Decision Making - benefits must exceed costs when it comes to decisions, we must be equally satisfied with the price we way.
- Utility is measured in hypothetical units called : utils
Ceteris Paribus : more utils are better than less utils
Diminishing Marginal Utility :
With each additional unit of the same product that we consume, we get a little less satisfaction.
The graph for this is provided below to get a better understanding.
-
The rational person will continue to engage in an activity only as long as marginal utility is positive (even though it is decreasing) in order to maximize total utility.
The Utility Maximizing formula
: MUx/Px=MUy/Py

aqureshi21 — 2020-10-09 19:32:48 UTC

We Did It

aedwards194 — 2020-10-09 21:19:27 UTC

OODLES OF UTILS

aedwards194 — 2020-10-09 21:47:41 UTC

the more utils the better