Economics

Please reword these paragraphs in your own words DO NOT USE any of the same words in these paragraphs.

• 1- Economics is the study of how human beings coordinate their wants and desires, given the decision-making mechanisms, social customs, and political realities of the society. Coordination refers to how the three central problems facing any economy are solved. These central problems are what, and how much to produce, how to produce it, and for whom to produce it.

When individuals want more than is available, it is described as a problem of scarcity which means the goods available are not enough to satisfy individual’s desires. The quantity of goods, services, and usable resources depends on technology and human action. Individuals’ imagination, innovativeness, and willingness to do what needs to be done can greatly increase available goods and resources

• 2-From my understanding in other courses supply and demand go hand in hand. Supply is the amount a product that is produced while demand is the amount needed and/or wanted by consumers. When you have a higher demand but a low supply the cost of a product will be more expensive, while if the supply of a product is high but the demand for the product is low then the price will be lower. For example, when feeding a family you can buy a pack of hot dogs for a cheaper price then that of purchasing a case of lobster tails. Reason being is hot dogs are sold everywhere in multiple varieties and manufactured in many ways so there is a surplus of them, while lobster tails are limited and are actually real food, meaning it’s not necessarily man made. supply of hot dogs are higher there for the price is cheaper and supply of lobster tails are lower therefore price is higher.

3-I thought this chapter was very informative and I learned about a couple new key aspects that I found interesting.  The first key term is called price ceiling.  This is when the government wants to hold prices down and puts a limit on how high a price can be charged.  Chapter 5 best explained a price ceiling in real world application by using the example of rent control.  It seems to me that rent control can have more disadvantages than advantages but it is interesting to read the examples in our text about how this can create a shortage of housing, hurting some, while others enjoy the luxury of low cost rent.  The second key term is called price floors.  This is when the government imposes limits on how low a price can be charged.  When there is an effective price floor, quantity supplied exceeds quantity demanded, resulting in excess supply.  A real world example of a price floor is the minimum wage.  I found this interesting because in the state that I live in, many counties are pushing for a higher minimum wage.  Lots of businesses and people are against the raise in minimum wage because it will possibly create a shortage of jobs and an excess supply of workers

• 4-This chapter went into detail about unemployment and I never realized how specific unemployment can get until I read this chapter.  I was interested in learning more about cyclical unemployment and structural unemployment.  Cyclical unemployment is temporary unemployment that can be expected to change as an economy recovers.  Structural unemployment is long term unemployment that occurs because of changes in the structure of the economy.  The text gave an example of cyclical unemployment when a waiter gets laid off because the demand for eating out at restaurants has gone down and this type of unemployment can be resolved by expansionary fiscal and monetary policy.  Structural unemployment is not as common in macroeconomics but it is easy to understand.  When someone is structurally unemployed, they must be willing to take the same job at a lower pay rate or consider retraining to obtain the same pay rate.  The text gives a good example of Chrysler doing this.  I think that many of us may have experienced this when the recession hit in 2008.  I was working construction and was almost immediately out of work when we went into the recession.  I was able to find work doing the same trade but the pay rates were almost cut in half.  At first, I was refusing to work at such a low pay for such hard work so I was structurally unemployed.  I then realized that some work is better than no work so I accepted the lower rates.  This is one of the major reasons that I decided to go back to school because if this happens again I want to make sure that I have training to keep the pay rate I am comfortable working for.

Question to answer for my teacher

1-Is there a difference in demand and supply studied at the microeconomic level versus the macroeconomic level?

• 2-unemployment is never a good thing to deal with. at my current work place there’s been some things going on when they’ve just been letting people go and telling the employees that are still employed that the now unemployed employees left to pursue other career choices. one of the guys that was laid off had been here for about 39 years and from what i know he was a very good worker and planned to retire at the end of this year. I find it great to know that his 401k did not diminish and that he was still able to call his being laid off a retirement. Basically I’m not sure if they have been letting certain individuals go due to economic reasons or if in fact there was something wrong that they were doing.

3-my old facility just laid off 400 employees due to facility closure and theywere all given the opportunity to transfer to another facility with in the company, I was one of those employees who had to make a decision to either transfer or figure out what I needed to do. We had many people come in to discuss all options. One of the options was these employees go on unemployment or go to state needed education. We had 520 employees and only 120 of us transfered, the rest either went on unemployment, retired, or found jobs in other companies. We are a private prison and I never thought that a prison would close, I’ve now been through 2 facility closures. Most of the employees who were on unemployment were on a structural unemployment they were all told they did not have to accept a job less than what they were making when they got laid off, so they stayed on unemployment

 

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