Common Sense Economics : Analysis

The chapter starts by giving the example of how the head of Coca-Cola Europe decided to give away Coke to East Germans as the Berlin Wall was falling in 1989. This gamble, which began as a loss, eventually paid off for Coca-Cola. Six years later, the former East Germany had matched West Germany in the consumption of Coke, an excellent example of the power of markets. The author gives a simplistic explanation of the communist economy. There is no law of supply and demand. The price of an item is the same regardless of where one buys it. This is due to the fact that every business is paid the same by the government for selling a specific item regardless of the amount sold. Our economy is a market economy and economists make two important assumptions.

In the United States, public policy is shaped by multiple factors, from average citizens voices in elections to interest groups and organizations. In their study, “Testing theories of American politics”, scholars Benjamin Page and Martin Gilens explore the impact of average citizens, the economic elite and interest groups have on the passage of public policy. Additionally through their, Page and Gilens(2014) have found “that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while mass-based interest groups and average citizens have little or no independent influence” (Pg 535). This means that when it comes to the creation of public policies, rich people and groups

The economy of Brazil is in the top ten largest economies along with the United States. It is the biggest in Latin America. Actually it is the seventh largest in the world. Brazil has used its newly found economic mechanism to syndicate its outcome in South America and show more of a role in the Global Businesses. The Obama Administration’s National Security Strategy recognizes Brazil as a developing center of effect, and greets the management of the country’s joint and global issues. The United States and Brazil associations mostly have been good in the recent years. But Brazil has other strengthening relations with neighboring countries and expanding ties with nontraditional partners in the South that’s developing.

Imagine that you have decided to open a small ice cream stand on campus called "Ice-Campusades." You are very excited because you love ice cream (delicious!) and this is a fun way for you to apply your business and economics skills! Here is the first month's scenario--you order the same number (and the same variety) of ice creams each day from the ice cream suppliers, and your ice creams are always marked at $1.50 each. However, you notice that there are days when ice creams remain unsold but other days when there are not enough ice creams for the number of customers.

Chapter 8: A question that has stuck with Wheelan for years, asked by one of his peers was, “If people know so much about public policy, then why is everything so messed up” (175)? The reason for that is because it leads to something far more significant: Even when economists reach consensus on policies that would be to our advantage, they frequently run into political opposition. And when it comes to interest groups in politics, it pays to be small because the tail can wag the dog. This can have a huge impact on the economy. They are usually the most successful because the consequence of requests they receive are spread over a large, disunified group of people. Wheelan states that small problems begin to distort the simplest jobs of a market

When I first looked into finding this book I didn’t think much of it as I just thought it was just another type of text book or some sort. I was thinking that this would be some kind of auto biography or something I would not be interested in. In fact after reading this book I was stunned by the different views and aspects of economics that was explain and I would had never thought about them in that sort of way. This book covers a lot about we discussed in class. This book explains different examples of economic concepts that may be used in our daily lives. They

They explained that: “Changes in incentives influence human behavior in predictable ways”. The main point of this concept is that the more attractive an option is the more likely an individual to choose it. Another point that they also focused on was the fact that if a particular product more costly, the more unappealing it will become to the consumer. They used examples such as employees will worker harder if they feel that they will be greatly rewarded or a student will study material that they feel will be on an

-Mohair farmers have earned a subsidy from the federal government for decades because the mohair farmers can get large payments from the government without taxpayers ever really noticing because the farmers who get the subsidy care a lot about it, while the rest of us taxpayers (paying mere pennies extra in taxes) do not really care. And, “any politician with a preference for job security can calculate that a vote for the mohair subsidy will earn the strong support of the mohair farmers while costing nothing among other voters” (Wheelan 177).

A corporate business enterprise is established under a specific legal framework where laws governing the operations and functioning of the enterprise are outlined. The activities of the enterprise are monitored and therefore such an enterprise is recognized by law. This is important due to the fact that legal suits can be filed by the enterprise within the provisions of the law.

All these wealthy groups and people would benefit from passing of a certain law. For example, big banks and central banks have an interest group, who uses congressmen to try to influence politicians so that they won’t make strict policy regarding banks systems and how they operate. Those rules may be affect banks or big business in generating fewer profits. Majority believe that it is a bad thing that interest groups and lobbyists are involved in legislating because their voices and ideas do not come directly from ordinary citizens. Their interest to grow their business and wealth may not benefit the general ordinary citizens of United States. The big business and wealthy groups may try to influence a bill to be passed for their interest and not for the interest of the general public. Nevertheless, Congressmen may listen to the big central banks because they have money to play around with. This includes donating to Congress campaigns to be

The definition of public goods is: A public good is an item consumed by society as a whole and not necessarily by an individual consumer. Public goods are financed by tax revenues. All public goods must be consumed

With the recent developments in the economy there could have not been a better time to

1. (10 pts.) Stella Ann Freeman is having a difficult time deciding whether or not to purchase a new car. How would understanding the concept of opportunity costs help her make a decision?

Many times the American people have asked themselves why certain topics take precedent over other topics that may seem worthy of attention. The common speculation is that money from special interest groups have infiltrated re-election campaigns are the ones who really have the power and last say on what occurs in government. Many people have campaigned in order to pass a reform that would disclose how a political campaign is funded or set a limitation on how much can be donated to a specific campaign. Some people may argue that doing so may infringe on the rights of voters and their decision on how much to donate or that it prevents individuals from expressing their opinions on political issues, but by not having rules in place on what can

This assignment has a maximum total of 100 marks and is worth 10% of your total grade for this course. You should complete it after completing your course work for Units 1 through 5. Answer each question clearly and concisely.