Microeconomics in Daily Life

As previously mentioned, Costco does have some direct competition within the industry from companies such as, another big box retailer Sam’s Club, as well as, Target and Walmart. Comparing for instance, Costco and Sam’s Club, both retailers offer basically low prices, mass quantities, miscellaneous items for the home, and require individuals to pay in order to shop at the establishment (Quirk, 2016). There is a minimal difference in the amount individuals pay to be members of these establishments; Costco’s annual fee is $55 and Sam’s Club is $45 (Quirk, 2016). Although both retailers have various similarities there are a couple of differences that stand out. For instance, Costco extends opportunities for home mortgages, security

Daily economic activities have an important influence on personal financial planning. In our society, the forces of supply and demand play an important role in setting prices. Economics is the study of how wealth is created and distributed. By doing my research, I found that each economic situation would affect me at a personal level.

In the United States, we encounter quite a bit of obstacles that we can’t seem to get rid of completely. We as a nation deal with inflation, unemployment, stagflation, recessions, depressions, and so much more. Reading these three articles opened my eyes to the world of economics, and even made me question the society we live in. I’ve learned that sometimes questions can’t be answered, and I learned that once we solve one issue, there is always another issue on its way. These articles made me analyze, and think about the future of economics, and what I can do to try and help the economy. These authors of these three articles make it very clear that there are issues in the United States, and they do an amazing job

1. Describe two examples of important things that financial planning skills can help you do, and explain why these things are important to you personally. (4-6 sentences. 2.0 points)

Small business are said to be the backbone of the United States economy. It said that small businesses contribute to growth and vitality in the specific area of the United States economic development. Small businesses play a huge role in how the business world is shaped. Entrepreneurs are smart, creative and innovative however, those same entrepreneurs need to have some knowledge that the study of microeconomics focuses on. With the study of microeconomics, their product or future business will succeed in an economic view point.

Researchers with the RAND Corporation examined data from studies on civilian-based grocery chains as well as previous studies on commissary shoppers. They concluded that because of a combination of factors, including the availability of other stores and the distance many commissary shoppers travel to get there, a price increase would drastically cut the amount of money shoppers spend and the number of times they come to commissary stores. The result would be lower revenue for the commissary and, potentially, continued budget shortfalls (p.

What is minimum wage? Minimum wage is the lowest legal paycheck a company can give to an employee. It is illegal for a company pay an employee less than minimum wage (Principles of Microeconomics). Unemployment, on the other hand, is the percentage of the total workforce who are without a job and are currently looking for a paying job. The unemployment rate is one of the most closely watched statistics due to its relationship with the interest rate. If the unemployment rate is rising, it shows the economy is becoming weaker and may even need a call for cut in interest rate” (businessdictionary.com).

“The key elements of Costco strategy are extremely low prices, a limited selection of naturally branded and private label products, a treasure hunt shopping environment, strong emphasis on low operating costs, and ongoing expansion of its geographic network of store locations.” To provide low prices Costco caps its markup on brand merchandise at 14% compared to 20% to 50% at other supermarkets. The equals out to a sales revenue that only equales several million dollars. This number excludes all other operating factors including the membership fees. Another important element of the strategy is that unlike other retailers they don’t offer window displays or any other thrills with in the stores. They know because of the reputation and because of the value that they offer their customers that the items that they sell offer value over all else.

Opportunity cost is the value of next best option. Giving up one thing to do something else.

Stores like Wal-Mart are famous for keeping their prices so low. This is one reason why they are able to maintain a grip on the consumers of an area. They accomplish this by keeping the cost to produce and transport the goods low. In January, a study by the Los Angeles County Economic Development Corp. found that, “an individual family could save $589 a year on groceries by shopping at a supercenter. Overall, shoppers could save $3.76 billion in merchandise nationwide.” (Blazier, A, 2004) A major reason they can keep prices lower than mom-and-pop run businesses is their ability to buy merchandise in bulk. Buying in bulk works the same way it does for a consumer. The more of a product that is purchased, the less the cost is per unit. Consumers see this every day when they go to stores like Sam’s Club or Costco. When they buy their merchandise in bulk, they are able to offer it to the consumer at a lower price. (Kale, 2011) This is what could eventually drive the mom-and-pop owned businesses out of the area, and draw a negative criticism from the public. The interesting thing about this criticism is that the public complains about Wal-Mart

When I was first given this assignment I was extremely perplexed at how I would even begin to finish it. I had no idea how economics related to my life in anyway. I hadn’t thought about it critically and I struggling terribly. Thanks to some much needed help from a fellow classmate, he allowed me to get an idea of things from his own essay. After reading not one, but two other essays, I was so surprised at how oblivious I had been. I never realized that just about everything that goes on in my daily life is, in fact, economics. I never realized that from the things I buy to the money I earn from working is all economics. The things I miss out of while working or going to school is a complete opportunity cost. Or even

Economics is a study of how society manages its scarce resources. The literal translation for economy is “one who manages a household.” “In an increasingly complex world connected by social and economic interaction and interdependence, news of stock market fluctuations, consumer confidence scores, and various economic indicators fill the media” (Broome & Preston-Grimes, 2011). This means that economics is everywhere, even in a home. Every household makes decisions that follow the economic principles. There are tradeoffs, and incentives. Supply and demand regularly show up in a household setting, as do decisions regarding limits on price and time. I

Microeconomics is the economic influences that impact at the micro, or firm, rather than macro level. The study of this subject is one that is highly valuable for any studying business with the provision of knowledge that will increase understanding of different influences and support the decision making processes. With the knowledge gained, along with the skills in applying that knowledge developed through class work and exercises for the different modules, there has also been the development of increased confidence, both personal and in the theories, in using the relevant concepts and tools in a practical setting.

I have gained much respect for Economics as a field of study during this course. Being a political science major, I can honestly say that there isn’t all that much science in many of the topics. Conversation in political science can be argumentative and normative without concrete reason or evidence. Economics, on the other hand, is intuitive and backed by research. More refreshingly, economics simply puts its research out for the world to see, and sure individual economists may voice their opinions about public policy, but as a field, it is based mainly on positive statements; it tells it like it is without venturing into how it should be. Economists do have a rough job in a way, they can’t simply do research by conducting regular experiments like altering the nation’s monetary supply or increasing the minimum wage to study the effects on unemployment. It is impressive that they find a way to use existing data to draw their conclusions. They really make the most out of what they are given. Additionally, it is nice that assumptions about complex economic topics are made so even students in basic principles courses can understand the concepts in simple economic models.

Microeconomics looks at how individual players in the economy, such as households and firms, interact. It focuses on the impact that their economic choices have on the allocation of scarce resources to meet unlimited demand. These interactions match what one party wants or demands in economic term and what the other gives in exchange (supply). Each time someone buys a chocolate bar from a newsagent or undertakes the morning paper round, there’s an interaction between supply and demand (ESRC).