[SOLVED] Discipline of Economics
What does the discipline of economics study? In your answer, use at least four of the following five terms: economics, scarcity, division of labor, specialization, economies of scale. Contrast microeconomics from macroeconomics. Contrast traditional economies, command economies, and market economies. Assess the importance and effects of globalization. Describe and graph your own example of a budget constraint using two goods (dont forget to label your axes). In your example, make sure to state what the budget is, the price of the two goods, what the slope of the budget constraint equals (make sure to include the correct sign), and interpret what the slope represents. Give an original example of someone making a decision at the margin. Make sure to discuss the marginal benefits, the marginal costs, and how the person decides the best decision (or when to stop). Graph a production possibilities frontier (PPF) showing the production of two potential goods (dont forget to label your axes). What do points within, on, and outside of the curve represent? What does a bowed-out PPF curve tell us about opportunity costs? Discuss what is meant by comparative advantage, and how trades between two individuals based on their comparative advantage can lead to a win-win situation.
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