Economics Lecture One - Revision history

Aschlafly at 04:44, July 16, 2014

2014-07-16T04:44:53Z

Aschlafly at 04:43, July 16, 2014

2014-07-16T04:43:03Z

Aschlafly at 04:42, July 16, 2014

2014-07-16T04:42:30Z

Aschlafly: better formatting

2013-02-28T02:57:04Z

better formatting

Aschlafly: better formatting

2013-02-28T02:40:05Z

better formatting

Aschlafly at 02:39, February 28, 2013

2013-02-28T02:39:38Z

Aschlafly: adding link for posting answers

2013-02-28T02:39:07Z

adding link for posting answers

Aschlafly: completed

2013-02-21T01:31:20Z

completed

Aschlafly at 01:26, February 21, 2013

2013-02-21T01:26:08Z

Aschlafly: Inflation tends to cause the prices of everything to increase over time, such that a candy bar that costs $1 today may have cost only 10 cents in the 1950s. When comparing prices from different time

2013-02-21T01:21:56Z

Inflation tends to cause the prices of everything to increase over time, such that a candy bar that costs $1 today may have cost only 10 cents in the 1950s. When comparing prices from different time

← Older revision		Revision as of 04:44, July 16, 2014
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−	{{Economics_Lectures}}	+	''You can post answers here: [[Economics Homework 1 Answers]]''
		+	<br>{{Economics_Lectures}}
	This course requires more thinking than reading and writing. The length of the lectures and homework will be only about half the length of weekly history assignments. The extra time is for you to think more. You will have time to read and reread the materials, and think about them, in order to fully understand the concepts. Repeatedly ask yourself and others questions, and ask questions in class. Test yourself with your own examples. You may have to read and think about a concept in economics many times before you really understand it. But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business. This course will enable you to deal with problems and help you understand behavior by others, including politicians. Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.		This course requires more thinking than reading and writing. The length of the lectures and homework will be only about half the length of weekly history assignments. The extra time is for you to think more. You will have time to read and reread the materials, and think about them, in order to fully understand the concepts. Repeatedly ask yourself and others questions, and ask questions in class. Test yourself with your own examples. You may have to read and think about a concept in economics many times before you really understand it. But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business. This course will enable you to deal with problems and help you understand behavior by others, including politicians. Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.

← Older revision		Revision as of 04:43, July 16, 2014
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−	~~<br>~~{{Economics_Lectures}}	+	{{Economics_Lectures}}
	This course requires more thinking than reading and writing. The length of the lectures and homework will be only about half the length of weekly history assignments. The extra time is for you to think more. You will have time to read and reread the materials, and think about them, in order to fully understand the concepts. Repeatedly ask yourself and others questions, and ask questions in class. Test yourself with your own examples. You may have to read and think about a concept in economics many times before you really understand it. But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business. This course will enable you to deal with problems and help you understand behavior by others, including politicians. Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.		This course requires more thinking than reading and writing. The length of the lectures and homework will be only about half the length of weekly history assignments. The extra time is for you to think more. You will have time to read and reread the materials, and think about them, in order to fully understand the concepts. Repeatedly ask yourself and others questions, and ask questions in class. Test yourself with your own examples. You may have to read and think about a concept in economics many times before you really understand it. But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business. This course will enable you to deal with problems and help you understand behavior by others, including politicians. Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.

← Older revision		Revision as of 04:42, July 16, 2014
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−	~~''You can post answers here: [[Economics Homework 1 Answers]]''~~
	<br>{{Economics_Lectures}}		<br>{{Economics_Lectures}}
	This course requires more thinking than reading and writing. The length of the lectures and homework will be only about half the length of weekly history assignments. The extra time is for you to think more. You will have time to read and reread the materials, and think about them, in order to fully understand the concepts. Repeatedly ask yourself and others questions, and ask questions in class. Test yourself with your own examples. You may have to read and think about a concept in economics many times before you really understand it. But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business. This course will enable you to deal with problems and help you understand behavior by others, including politicians. Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.		This course requires more thinking than reading and writing. The length of the lectures and homework will be only about half the length of weekly history assignments. The extra time is for you to think more. You will have time to read and reread the materials, and think about them, in order to fully understand the concepts. Repeatedly ask yourself and others questions, and ask questions in class. Test yourself with your own examples. You may have to read and think about a concept in economics many times before you really understand it. But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business. This course will enable you to deal with problems and help you understand behavior by others, including politicians. Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.

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 ''You can post answers here: [[Economics Homework 1 Answers]]''
-<br>This course requires more thinking than reading and writing.  The length of the lectures and homework will be only about half the length of weekly history assignments.  The extra time is for you to think more.  You will have time to read and reread the materials, and think about them, in order to fully understand the concepts.  Repeatedly ask yourself and others questions, and ask questions in class.  Test yourself with your own examples.  You may have to read and think about a concept in economics many times before you really understand it.  But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business.  This course will enable you to deal with problems and help you understand behavior by others, including politicians.  Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.
+<br>{{Economics_Lectures}}
 Start working on the problems early in the week, so that you can ponder them a while before answering.  Answers may not occur to you at first.  It may be days after you read a problem, and while you're doing something completely different, when a light bulb turns on in your mind and you think, "Eureka" (I solved it!).  Give yourself plenty of time for that to happen, by starting early on the problems.  They are not difficult if you start early in solving them.  If you get "stuck" on a problem, then you might find it helpful to look at similar problems and their model answers from the version of this course taught in 2007, which are posted along with lectures in this course online.<ref>http://www.conservapedia.com/Economics_Lectures</ref>

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 {{Economics_Lectures}}
-<small>You can post answers here: [[Economics Homework 1 Answers]]</small>
+''You can post answers here: [[Economics Homework 1 Answers]]''
 <br>This course requires more thinking than reading and writing.  The length of the lectures and homework will be only about half the length of weekly history assignments.  The extra time is for you to think more.  You will have time to read and reread the materials, and think about them, in order to fully understand the concepts.  Repeatedly ask yourself and others questions, and ask questions in class.  Test yourself with your own examples.  You may have to read and think about a concept in economics many times before you really understand it.  But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business.  This course will enable you to deal with problems and help you understand behavior by others, including politicians.  Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.

← Older revision		Revision as of 02:39, February 28, 2013
Line 1:		Line 1:
	{{Economics_Lectures}}		{{Economics_Lectures}}
		+	<small>Post answers here: [[Economics Homework 1 Answers]]</small>
	This course requires more thinking than reading and writing. The length of the lectures and homework will be only about half the length of weekly history assignments. The extra time is for you to think more. You will have time to read and reread the materials, and think about them, in order to fully understand the concepts. Repeatedly ask yourself and others questions, and ask questions in class. Test yourself with your own examples. You may have to read and think about a concept in economics many times before you really understand it. But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business. This course will enable you to deal with problems and help you understand behavior by others, including politicians. Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.		This course requires more thinking than reading and writing. The length of the lectures and homework will be only about half the length of weekly history assignments. The extra time is for you to think more. You will have time to read and reread the materials, and think about them, in order to fully understand the concepts. Repeatedly ask yourself and others questions, and ask questions in class. Test yourself with your own examples. You may have to read and think about a concept in economics many times before you really understand it. But once you understand these concepts, you can use them your entire life, and this will help you in ways beyond money or business. This course will enable you to deal with problems and help you understand behavior by others, including politicians. Many of my students have told me that economics is the best course they ever took from me, and I teach many other topics.

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 If you buy clothes over the internet instead, then you avoid some transaction costs but also take a risk that you might not like it when it arrives.  Also, you have to pay for shipping when you buy over the internet, and the shipping costs are transaction costs.
-“Transaction costs” are defined as the time, effort and added expense associated with the purchase of a good or service.  Look around, and you will start noticing them everywhere.  Almost nothing can be bought without all sorts of middlemen tacking on extra costs.  Effort is also required by you when you buy almost anything.  Some entire professions are built on transaction costs.  Most attorneys, for example, make their entire living as transaction costs.  People hire an attorney to help them obtain what they want.  Salesmen, too, live off of transaction costs.
+“Transaction costs” are defined as the time, effort and added expense associated with the purchase of a good or service.  Look around, and you will start noticing them everywhere.  Almost nothing can be bought without all sorts of middlemen tacking on extra costs.  Effort is also required by you when you buy almost anything.  Some entire professions are built on transaction costs.  Salesmen, for example, live off of transaction costs that are part of buying and selling goods.  One could even describe health care as a “transaction cost” of living!
 We will be referring to transaction costs throughout this course.  They are one of the most basic concepts in economics.  Often transaction costs are obstacles to the efficient purchase and sale of goods.
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 When the early Jamestown settlers were on the brink of failure because no one was working, John Smith arrived and instituted a new rule: “He who does not work, will not eat.”  Each individual then began working just to feed himself.  The community soon became very successful.  The invisible hand is the force that guides people to do work that is needed such that others benefit.
-The opposite of the “invisible hand” is government control.  In dictatorships like the former communist Soviet Union under Josef Stalin, the government dictates what people will and will not do.  There is no “invisible hand.”  The result is often disastrous.  Tens of millions of people starved to death under Stalin’s rule due to the improper government planning.  Stalin may have even starved them intentionally.
+The opposite of the “invisible hand” is government control.  In dictatorships like the former communist Soviet Union under Josef Stalin, the government dictates what people will and will not do.  There is no “invisible hand.”  The result is often disastrous.  Tens of millions of people starved to death under Stalin’s rule due to his communistic government planning.  Stalin may have even starved them intentionally.
 ==Example of the Invisible Hand: "I, Pencil"==
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 <br>http://www.conservapedia.com/Economics_Homework
-Alternatively, you can hand in your homework answers on paper at the next class, for me to grade and return at the following class.
+Alternatively, you can email me your homework answers.  All homework is due within one week.
 If you cannot figure out answers to this or any other homework assignment in this class, then try looking at the model answers to similar questions as posted here: http://www.conservapedia.com/Economics_Lectures
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 .  Imagine that your family has two options for dinner:  eat at home, or go out to eat at McDonald's.  Which option incurs more transaction costs?  Identify two specific transaction costs.  Which option is cheaper for your family, and why?
-.  Define the concept of "scarcity" in your own words, and give an example of how an increase in scarcity for a good or service increases its price.  Your example might be a World Series ticket (a good) or a special medical operation (a service), or anything else you can think of that is "scarce" in an economic sense.  Extra credit:  when do people exaggerate scarcity in their minds?
+.  Define the concept of "scarcity" in your own words, and give an example of how an increase in scarcity for a good or service increases its price.  Your example might be an item in a store (a good) or a special medical operation (a service), or anything else you can think of that is "scarce" in an economic sense.  Extra credit:  when do people exaggerate scarcity in their minds?
 .  What is the “invisible hand”?  Discuss what it is, using an example (which could be from the story in the lecture about the making of a pencil).
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 ===Honors===
-Write an essay totaling about 300 words (rough approximation only) on one or more of the following topics (for example, you essay can be entirely about one of the questions below, or can address more than one of the questions below):
+Write an essay totaling about 300 words (rough approximation only) on one or more of the following topics (for example, your essay can be entirely about one of the questions below, or can address more than one of the questions below):
 .  Please suggest an improvement to our definition of "economics", being as creative as you like, and explain why you think your definition might be better.
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 .  "Money is a good servant, but a poor master."  Please explain.
-.  Improve on the lecture's definition of scarcity, and/or discuss the Ehrlich-Simon disagreement.
+.  Improve on this lecture's definition of scarcity, and/or discuss the Ehrlich-Simon disagreement.
-.  (Based on a true story.)  Imagine that you are riding on an airplane and need to finish a written project by the time it lands in order to earn a fee of $500.  The passenger next to you, however, keeps interrupting you by complaining about how she lost a $5 bill in the airport before the plane took off.  You keep telling her to forget about it, but she won't.  She keeps bothering you so much that you cannot get your work done, which is worth far more than $5.  What would make sense in purely economic terms for you to offer to get her to stop bothering you about it?  Explain.
+.  (Based on a true story.)  Imagine that you are riding on an airplane and need to finish a written project by the time it lands in order to earn a fee of $500.  The passenger next to you, however, keeps interrupting you by complaining about how she lost a $5 bill in the airport before the plane took off.  You keep telling her to forget about it, but she won't.  She keeps bothering you so much that you cannot get your work done, which is worth far more than $5.  What would make sense in purely economic terms for you to offer to get her to stop bothering you about it?  Discuss the economics.
 .  "There is no such thing as a free lunch!"  Discuss the concept of (economic) scarcity in the context of that saying.

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 There was a famous bet made in 1980 after the liberal Paul Ehrlich claimed that an increase in world population would cause greater scarcity in basic natural resources, such as copper, chromium, nickel, tin, and tungsten.  A "classical" (conservative) economist, Julian Simon, predicted that people would seek and find substitutes for scarce resources, such as other materials, and that this would prevent greater scarcity and higher prices.  The wager was that the liberal Ehrlich predicted that the price of these metals (also called "commodities") copper, chromium, nickel, tin, and tungsten would increase in price by 1990; the conservative Simon predicted their prices would not increase.
-The classical economist Simon won the bet: the price of three of the five metals fell over that period and, when the price was adjusted for the effects of inflation,<ref>Inflation tends to cause the prices of everything to increase over time, such that a candy bar that costs $1 today may have cost only 10 cents in the 1950s.  When comparing prices from different time periods, it is necessary to "adjust for inflation" to compare their "real" cost in the value of money at the particular time.</ref> all five metals declined in their real prices.  In the case of tin, its price fell from $8.72 a pound in 1980 to only $3.88 a pound in 1990.  This was true even though the world's population increased by 800 million during that period.
+The classical economist Simon won the bet: the price of three of the five metals fell over that period and, when the price was adjusted for the effects of inflation,<ref>Inflation tends to cause the prices (and wages) for everything to increase over time, such that a candy bar that costs $1 today may have cost only 10 cents in the 1950s.  When comparing prices from different time periods, it is necessary to "adjust for inflation" to compare their "real" cost in the value of money at the particular time.</ref> all five metals declined in their real prices.  In the case of tin, its price fell from $8.72 a pound in 1980 to only $3.88 a pound in 1990.  This was true even though the world's population increased by 800 million during that period.
 Free market competition handles issues of scarcity extremely well, because it can find lower-cost substitutes over time, which drives down the costs to the public.  For example, cheaper and better plastic was used instead of these metals during that period.
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 ==Transaction Costs==
-Whenever we buy something, there are incidental charges known as “transaction costs.”  These are the annoying burdens of time and money that interfere with our buying what we need or want.  When you buy clothes, you have to spend time finding something you like.  No one is going to pay you for that time you spend.  You also have transportation costs.  Then, when you finally find what you want, you have to pay extra for it to fund the salary of the sales clerk at the store.  You also have to pay sales taxes on the purchase.
+Whenever we buy something, there are incidental charges known as “transaction costs.”  These are the annoying burdens of time and money that interfere with our buying what we need or want.  When you buy clothes, you have to spend time finding something you like.  No one is going to pay you for that time you spend.  You also have transportation costs.  Then, when you finally find what you want, you have to pay extra for it to fund the salary of the sales clerk at the store.  You may also have to pay sales taxes on the purchase (but not in New Jersey, which exempts clothing from sales tax!).
 If you buy clothes over the internet instead, then you avoid some transaction costs but also take a risk that you might not like it when it arrives.  Also, you have to pay for shipping when you buy over the internet, and the shipping costs are transaction costs.