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November 03, 2008

Equilibrium (Macro/Micro Ch. 3)

Take a look at this post from the Marginal Revolution blog:

 

http://www.marginalrevolution.com/marginalrevolution/2008/06/the-economics-1.html

 

1.) Draw a supply and demand diagram of the market for sawdust:

What is it that shifts the supply curve?  Which direction does it shift in?

 

2.) Now draw a supply and demand diagram of the market for milk: What is it that shifts the supply of milk?

 

3.) What does Alex mean when he says that “capitalist production system minimizes waste?”  Example: If a business owner turns the lights off at his factory every night instead of just keeping the lights on all night, who pockets the savings?

Posted at 12:11 PM in Business Fluctuations/Cycles, China, Complimentary Goods, Conditional Convergence, Consumer Surplus, Consumption (C), Deadweight Loss, Demand, Demand Shifters, Economic Growth, Economies of Scale, Elasticity of Demand, Elasticity of Supply, Equilibrium (Price/Quantity), Free Riding, Gains from Trade, GDP, GNP, Government Purchases (G), Human Capital, Incentives, India, Inferior Goods, Inflation, Institutions, Investment (I), Japan, Marginal Product of Capital, Net Exports (Exports/Imports), Non-rivalrous Goods, Normal Goods, Oil, Opportunity Cost, Physical Capital, Price Ceilings, Price Floors, Producer Surplus, Real GDP Growth, Recession, Shortage, Solow Model, South Korea, Steady State Growth, Substitute Goods, Supply, Supply Shifters, Surplus, Technological Knowledge, Tradeoffs |

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Comments

Greg Delemeester

Complementary or complimentary? The former, I think.

Posted by: Greg Delemeester | April 08, 2009 at 03:03 PM

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For More Information

Modern Principles of Macroeconomics

  • Table of Contents
    1. The Big Ideas 2. Supply and Demand 3. Equilibrium: How Supply and Demand Determine Prices 4. Price Ceilings and Price Floors 5. GDP and The Measurement of Progress 6. The Wealth of Nations and Economic Growth 7. Growth, Capital Accumulation and the Economics of Ideas: Catching Up vs. The Cutting Edge 8. Savings, Investment, and the Financial System 9. Stock Markets and Personal Finance 10. Unemployment and Labor Force Participation 11. Inflation and the Quantity Theory of Money 12. Business Fluctuations and the Dynamic Aggregate Demand-Aggregate Supply Model 13. The Real Business Cycle Model: Shocks and Transmission Mechanisms 14. The Federal Reserve System and Open Market Operations 15. Monetary Policy 16. The Federal Budget: Taxes and Spending 17. Fiscal Policy 18. International Trade and Globalization 19. International Finance

Modern Principles of Microeconomics

  • Table of Contents
    1. Introduction 2. Supply and Demand 3. Equilibrium: How Supply and Demand Determine Price 4. Elasticity and its Applications 5. The Price System: Signals, Speculation and Prediction 6. Price Ceilings 7. Price Floors, Taxes and Subsidies 8. International Trade and Globalization 9. Externalities: When Prices Send Imperfect Signals 10. Profits, Prices and Costs Under Competition 11. Monopoly 12. Price Discrimination 13. Business Strategy: Cartels, Games, and Critical Mass Goods 14. Getting Incentives Right: Lessons for Business, Sports, Politics and Life 15. Labor Markets 16. Stock Markets and Personal Finance 17. Public Goods and the Tragedy of the Commons 18. Economics, Ethics and Public Policy 19. Political Economy