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In the three articles I researched, each author looks at the following use of marginal cost & marginal revenue in decision-making with a strategic point of view. I looked at Covering Entrepreneurship and small business: Basic economic principles: Part II & I the articles written by Karen Hallows. I also looked at What Are the Benefits of Marginal Costs Equal to Marginal Revenue by Thomas Metcalf. The conclusion in my first article is she looks at the basic principles of economics. Risk and return marginal benefits, marginal costs, and opportunity costs and sunk cost. She looks at a few examples. One was the food on the airlines. She goes on to state the food is bad. However, explaining that risk and return on the food is not the airlines priority it is to have a full plane of passengers. Next, she looks at opportunity cost regarding college educations and states it is lower for young adult’s age group of 18-21 verses older age groups 48-51. She also shows a few great examples of sunk cost. Best example was the all you can eat pizza buffet for $5.00. She shows an example of a group of 25 people going to Pizza Hut. She states that the manager has decided to refund back half of the groups $5.00. She states that the other group will essentially eat more to help
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He defines business owner’s choices, marginal cost and marginal revenue and maximizing profits in easy to understand business concepts. He looks at choice that business have to make. For instant, should they increase production? However, how this will increase employee hours as well as leading to overtime. He looks at increasing stations or space in order to maximize marginal revenue. He does a good job of using real life scenarios for the reader to understand the concept of economistic viewpoint of increasing productions will ultimately lead to increase of
The main points are not sufficient, strong, and well-supported. for instance, upon reading in the Washington Post the plans of manufacturers to improve the functions of appliances, he retaliates by saying, "did they ever stop to ask themselves WHY a consumer, after loading a dishwasher, would go to the office to start it?" as it can be seen, the author provided a sample situation that obviously does not portray the true purpose and value of the particular feature. All throughout the piece, he provides examples of the same nature. These failed shots at wittiness led to an ineffective elaboration of his points because, instead of clever reasoning, he unfortunately resorted to questions
In general, the reading and the AP textbook both contained the same economic concepts, but they sometimes used different terminology and economic models to explain them. One similarity was the concept that ‘everything is scarce and that all individual and firms seek to maximize their utility and benefits. Unit 3 started with an interesting historical overview of workdays and how it had decreased throughout the world due to technological factors and norms. The highlight of the Unit was explaining the interrelation between the concept of utility maximization and the feasible frontier, rather than separately. It explains how we can determine a person’s preferences of how much hours they want to work (or study) simply by setting the marginal
From this novel, the reader can learn more about the economic system, and how it is applied to life. The reader is able to enjoy the narrative along with learn the principles that are introduced by Roberts.
An assumption that economists make is that individuals try to benefit their lives as much as possible. Basically they invest in things that don’t necessarily make them happy, but will benefit them in the long run, or just things that give utility. Another assumption is that firms always try to make the most money they can. The joke about why the entrepreneur crossing the road is perfect. The example he gives to prove that maximizing utility doesn’t go hand in hand with selfishness is about a women who died in her nineties who lived her life as a laundress lived in a small apartment with little in her apartment such as a black and white television. She wasn’t poor and even gave away $150,000. Her utility she gained was from saving her money than spending it on lavish things. This goes to show that everyone gets utility from their lives in different ways. Maximizing utility is just a way to live life comfortably. Many things hold utility, even those that are
...s his claims with data from his own personal experience, some might argue that every business is different. He lacks evidence he would receive from examining more than just two types of businesses that would support his argument. Even though Buffet’s claims are more often than not true, the data that can completely support him was not given in his essay because he has not surveyed every business that has ever been in existence.
What are the major points of the article and why do you think they are main
The conclusion of the research in economics, both macroeconomics and microeconomics have a role they play to help an organization to be successful. Most people have a misconception about economics. The economy places a big part of our everyday life whether it be from purchasing a house or going into business. Customers play a big part in the economics because they help determine the direction that the economy is
David Leonhardt wrote an opinion editorial article about how colleges have issues and how these issues can be fixed. These issues are based off of how America's economy does not support colleges and college students also how the lower class has it rough when it comes to college.
Marginal cost (benefit) is the change in total cost (benefit) caused by an incremental change in the level of activity (Thomas & Maurice, 2012, pp. 95). In these definitions incremental is referring to small change relative to the total level of activity. Marginal cost is representative of the slope of the total cost curve and marginal benefit is the slope of the total benefit curve. The intersection of these two lines on a graph represent the point where the net benefit is maximized, or the optimal level of
Todd Buchholz’s From Here To Economy is a pleasurable and entertaining piece of economic literature. The purpose of this book is to provide the reader with the basic knowledge of economic principles in an entertaining and engaging way. The key components in making this book so enjoyable are his smooth transitions, and unique layout. The figurative language included in this piece is artfully inserted to engage the reader and make them what to continue reading. Each of these components is a key player in making this a great educational book.
Total revenue, which is the total amount of income received from the sales of a certain quantity of goods or services. Total revenue can be calculated by multiplying the price of a product times the quantity sold. For instance, if 160 baseball caps are sold and each baseball cap was priced at $5 each, the total revenue would be (160*5) $180.
The crucial importance and relevance of economics related disciplines to the modern world have led me to want to pursue the study of these social sciences at a higher level. My study of Economics has shown me the fundamental part it plays in our lives and I would like to approach it with an open mind - interested but not yet fully informed.
Managerial economics deals with the use of economics’ principles, techniques and concepts to managerial problems of business and industrial enterprises. Managerial economics helps firms in formulating logical tools and techniques for managerial policy and decisions making. Furthermore, it helps in narrowing the gap that exists between economics in theory and in practice and guides managers in making decisions that are related to customers, competitors, suppliers and internal functioning of a firm. It also encourages the use of statistical and analytical tools in solving practical business problems by
Business finance has taught me how to manage risk and return as well as making capital investment decisions throughout the semester. Professor Schott has gone through each chapter carefully well making sure that each student grasps each concept before moving on. He has used many tools such as LearnSmart, lectures and homework assignments to make sure that us students have a good idea of the concept before giving us exams.
Sullivan, A., & Steven M., (2003). Economics: Principles in action. Upper Saddle River, New Jersey : Pearson Prentice Hal