Econ

• Make sure that you are using an open outline like format in the construction of your answers.

Please provide lots of detail.

1. To a great extent, Economics is about connecting the dots (finding relationships between seemingly unrelated things).

Our behavior impacts our ecosystem and all of the ecosystem services. Those impacted ecosystem services in turn have impacts on the people and economies of the global north and global south.

a. Pick 5 ecosystem services from the list in slide 13.

b. Explain how each of your 5 ecosystem services is supposed to work.

c. Thoroughly explain the human behavior that has disrupted each of those services.

d. Explain how those disruptions to each ecosystem service impacts the two different parts of the world (the global north and global south).

e. For each of the 5 ecosystem services, thoroughly explain 3 things that we should start doing right now to repair or at least stop the damage to the 5 ecosystem services you selected. Be sure you provide and explain your 3 recommendations for EACH of the 5 ecosystem services you selected!

2. Planet Earth is our only home for the time being. As global populations grow and our resources dwindle, we should worry more about the issues of SCARCITY AND CHOICE

i. There are 17 Rare Earth Elements. Pick any 5 of them, and for EACH of the 5, explain in detail why they are so critical to us.

Include in your answer:

a. what it used for;

b. why are those things so critical?

c. Where in the world the resource is located?

d. And approximately how much is left. e. For EACH of the 5, please explain 3 things we need to start doing today to avoid running out of that resource. It is very important that you provide thorough and complete explanations here.

b. The theory of rational behavior says that we humans act in our own self-interest. Given our actual behavior and the decisions we have made and are continuing to make relative to the planet,

i. Explain how over-pumping aquifers around the world is in our best interest. Gotta think about this!

ii. What does over-pumping of aquifers really mean?

iii. Explain how the continued over-pumping of aquifers in America, China, and India, could impact our ability to survive on the planet. This will require that you find out what these 3 nations have in common that has something to do with aquifers. Need some detail here.

iv. Explain in detail 3 things we can do to stop the over-pumping problem. Focus on the top uses of water in the world.

c. Utility Concepts:

i. Explain the 3 concepts: Utility, Marginal Utility, and Diminishing Marginal Utility. ii. Explain how EACH of those 3 concepts could relate to a yes or no decision to implement the Keystone XL Pipeline project.

d. The Theory of Consumer Behavior:

i. Explain EACH of the key assumptions of the Theory of Consumer Behavior and what the theory tells us. Read the slide and listen to the audio.

ii. Does the theory of consumer behavior reflect reality? If yes, then why. If no, the why not.

e. Marginal analysis is a decision-making tool.

i. Please define Marginal Cost ii. Please define Marginal Benefit,

iii. Explain these 3 cases in terms of what you should do regarding an activity.

1. MB>MC 2. MC>MB 3. MC=MB

iv. Explain 3 examples of MC related to the Keystone XL Pipeline question.

v. Explain 3 examples of MB related to the Keystone XL Pipeline question.

3. The Production Possibilities Model is one of the first Economic Models students learn about.

a. Please explain what the model teaches us.

b. Please explain each of the 4 assumptions of the model.

c. Please explain Productive Efficiency and how it relates to the ppc.

d. Please explain Allocative Efficiency.

e. Please provide a thorough explanation of the 2-step process for finding the point of allocative efficiency on the PPC.

f. On the topic of Economic growth: need to see some detail here.

i. What does it mean?

ii. How can it be graphically represented?

iii. What are the prerequisites to Economic growth?

iv. Why is Economic growth important to you and your country?

v. Please provide thorough explanation of 3 factors that would tend to limit economic growth. Be sure you explain how those factors would actually limit economic growth.

g. The Presentville – Futureville case:

1. Explain what motivated each group to make the decisions they made. 2. Explain the impact of those decisions on the future of each group. 3. Which group is most like America, and why? 4. What does this story teach you?

h. Law of increasing opportunity cost:

1. Explain it.

2. What does it teach us?

3. How could it be explained graphically?

i. Explain how you could use the Production Possibility Model to represent the US Economy during 2008 – 2010.

4. Every country has its own unique type of Economic System. Ours is called Capitalism.

a. Please list and explain 5 “good” things Capitalism has produced for us over the years. Make sure you provide thorough explanations of why you believe these are “good” things. This is harder than it looks! Think carefully and be objective. Nothing is 100% good or bad, so you will need to be very thorough in your explanations.

b. Please list and explain 5 “bad” things Capitalism has produced for us over the years. Make sure you provide thorough explanations of why you believe these are “bad” things.

c. Please explain in detail what would happen to our capitalist system when it is confronted with limited global resources and limited global markets.

5. The Circular Flow Model with Government is another important model for students to understand.

a. Please explain what the model shows us.

b. List and explain the characteristics of each component – be very thorough and provide plenty of detail! You

must have at least 4 characteristics for each component.

c. Thoroughly explain how each component of the model interacts with the other components – be very thorough – this requires lots of detail! Explain how all of the sectors and markets interact with each other. You can do this as part of your answer to part ( b) if you like but understand that this will require significant detail!

6. Demand, Supply, Market Equilibrium a. Demand:

i. Please Thoroughly and completely define demand.

ii. Please state the law of demand.

iii. List and thoroughly explain the 3 factors that support the law of demand. Be sure you explain how each actually supports the law of demand. 1. Don’t just copy from the slides, explain what they actually mean and how they support the law of demand. iv. List and explain the determinants of demand and how each can cause an increase in demand and a decrease in demand. 1. List and explain each of the 5 determinants and how they impact demand.

v. Thoroughly and completely explain the differences between a change in demand and a change in quantity demanded along with the causes of those changes, and how each change is graphically represented.

b. Supply.

i. Define supply.

ii. State the law of supply.

iii. List and explain the determinants of supply and how each can cause an increase in supply and a decrease in supply.

iv. Thoroughly and completely explain the differences between a change in supply and a change in quantity supplied, the causes of those changes, and how each is graphically represented.

c. Market equilibrium.

i. Please thoroughly and completely explain what market clearing equilibrium means. 1. Don’t just copy stuff, explain what this really means. Please be thorough.

ii. Thoroughly and in detail, explain what happens when a price is above the equilibrium price, and why those things happen!!! Detail!

iii. Thoroughly and in detail, explain what happens when a price is below the equilibrium price, and why those things happen!!! Detail!

iv. Thoroughly and completely explain the two government intervention cases, price floors and price ceilings and give examples of each.

7. In the discussion of the Market System we talked about the characteristics of the Market system and 4 Fundamental Questions that every economic system must answer.

a. List and thoroughly and completely explain those 4 fundamental questions and how they are answered. All the necessary information is provided in the slides and the audio lectures. Be sure you provide thorough and complete explanations throughout.

i. What will be produced?

ii. How will the goods and services be produced?

1. Why must firms try to employ the most economically efficient production techniques?

2. For each of the following issues, please explain in detail, why they are important to a firm and how a firm might address each one (need to see the detail here):

a. Optimal plant location

b. Resource Prices

c. Resource Productivity d. Transportation Costs

b. Who will get the goods and services?

c. How will the system accommodate change?

d. Characteristics of the Market system.

i. Select any 5 of the characteristics of the Market system that we covered, and explain each of them. Be thorough!

ii. Explain how each characteristic you selected impacts the 1% versus the 99%.

8. Public goods vs. Private goods.

a. Private goods:

i. Please explain private goods.

ii. Please explain their characteristics.

iii. Please give 2 examples of private goods, including why those examples best fit your definition.

b. Public goods:

i. Please explain public goods.

ii. Please explain their characteristics.

iii. Please give 2 examples of public goods, including why those examples best fit your definition.

c. Free rider problem: i. Please thoroughly and completely explain the free rider problem.

ii. Please give two examples of the free rider problem, and explain why they are good examples.

d. quasi-public goods:

i. Please thoroughly and completely explain the presence of quasi-public goods.

ii. Please provide 3 examples of quasi-public goods and explain why they are good examples.

iii. Explain how quasi-public goods are used by the 1% versus the 99%.

9. Depreciation and Appreciation of currency.

a. Please thoroughly and completely explain how the US dollar might depreciate relative to another currency, and how that would impact U.S. GDP.

b. Please thoroughly and completely explain how the US dollar might appreciate relative to another currency, and how that would impact U.S. GDP. 10. Market Failure.

a. State the definition of a market failure,

b. List and explain the 4 causes of market failure included in the slides, including how they actually lead to over or under allocation of resources (market failure). Don’t miss this part! Must be very specific.

 

c. State the definition of spillovers costs

d. Give two examples of a spillover cost situation and explain why your examples are correct.

e. Explain in detail, the economic effects of spillover costs. Provide details starting with the firm avoiding costs (how and why that happens) and conclude by explaining the nature of the market failure and what it really means.

f. Explain in detail, how spillover costs are corrected and how those two approaches would actually work to solve the problem. Be very detailed.

g. State the definition of spillover benefits.

h. Give two examples of a spillover benefit situation and explain why your examples are correct. Be specific.

i. Explain in detail, the economic effects of spillover benefits. Explain why the market demand curve understates true demand and what happens next leading to the market failure. Explain the nature of the market failure.

j. Thoroughly and completely explain how spillover benefits are corrected and the economic implications of the corrections. Explain the two approaches used to solve the spillover benefit problem and how they work to solve the problem.

11. Throughout the age’s countries have implemented impediments to trade.

a. What is a tariff?

b. Why would America impose tariffs against another nation?

c. Why would the U.S. impose steep tariffs on Chinese solar panels prior to 2016? i. Explain how this would work to accomplish the U.S. objective.

d. Given the current trade war with China and other nations, please explain:

i. Which industries are being hurt by higher tariffs against foreign nations and how are they being hurt?

ii. Which industries are being helped by higher tariffs against foreign nations and how are they being helped?

iii. Explain how and why the American customers of those industries are being impacted. Please provide thorough explanations.

e. What is an import quota?

 

f. Why would America implement import quotas?

g. Identify 3 cases where the U.S. has imposed import quotas on another country and explain why each were implemented. Be thorough.

h. What are non-tariff barriers?

i. List and explain 3 examples of non-tariff barriers imposed by the U.S., why they were implemented, and their impact on the U.S. and other countries.

j. All trade barriers are suddenly eliminated. Explain what would happen to employment, national income, and GDP in America, and why those things would happen.