seek to get the most value from their time and resources
Generally, people seek to get the most value from their time and resources. The advantages of an undertaking have to outweigh the costs for it to be viable. Economists apply a tool to make essential decisions on how to apportion scarce resources so as to reduce the costs and maximize benefits. Marginal analysis is what economists use to make the decision and it involves marginal benefits as wells as marginal costs. When marginal benefits are higher than or the same as the resultant marginal cost, then the investment is viable and should be undertaken. If an undertaking records lower benefits when compared to the marginal costs, then the undertaking ought to be ignored. This is a rational analysis of any undertaking including the decision to pursue higher education. The statement in question is irrational since before reaching such a conclusion there is a need to outweigh the marginal cost and also the marginal benefits. Consequently, research has to be done to examine whether pursuing higher education is worth its cost. Get to know the major take, the annual costs involved in the major, and the cost worthiness of attending a particular university. Compare different fee structures from various universities noting the costs, the pass rate, and the weight of their certificates.
- Division and specialization depend on two major principles, the absolute and the comparative advantage. Absolute advantage indicates the best choice while comparative advantage indicates the least likely loss to be felt when choosing one thing over another. Although I possess the absolute advantage to work on both mart and writing, it does not automatically conclude that I possess a comparative advantage in the two skills. The school project ought to be divided through the utilization of whoever possesses the comparative advantage. As an illustration, I can calculate 50 math questions and write 4 papers hourly. My partner can calculate 40 math questions and write 3 papers hourly. To evaluate the comparative advantage in mathematics we would divide the number of essays that can be written by the number of math problems that can be done. My partners and I opportunity cost of performing math questions will be 4/50= 0.08 and 3/40=0.075 respectively. Therefore, according to this analysis, my partner has a lower opportunity cost in doing math tasks. When calculating the comparative advantage in writing, my opportunity cost and my partners are 50/4=12.5 and 40/3=13.3 respectively. Since my opportunity cost in writing is lower than my partners as a result I should do the writing task.
- Introducing a machine that lets cow’s milk themselves increases the quantity of milk to be sold at the same time reducing the selling price. With the decrease in milk prices as well as an increase in the quantity of milk, the equilibrium price will shift to the right. The equilibrium price amounts to the price whereby the needs of the consumers and those of the producers agree. On the other hand, the equilibrium quantity is where the production by a supplier meets exactly what consumers want to purchase.
- With an increase in more than 10% bone density after consuming 8 ounces of milk daily, people will most likely consume more milk when compared to before. A rise in demand for milk warrants a rise in supply as well. The consequences of a rise in demand and supply is an increase in the equilibrium price to balance the demand and supply curves of the need for milk. Understanding how the equilibrium is affected in the demand curves helps come up with an effective and balanced market.
- A positive externality happens another person benefits from the consumption of the produce of a good. I have benefited from the positive externalities of the building of new homes in my neighborhood. One of the benefits is that I am able to enjoy good quality housing and the advantages that come with it. There is a decrease in social problems like drug use and criminal activities. My role in the contribution of quality housing has been planting a garden to better the environment and enhance the beauty of the neighborhood. When the environmental standards are concerned, I have benefited from quality insulation that has helped lessen the heating costs. The overall public health has also increased because of good sanitation. The government assisted in subsidizing building materials, knocked down slum housing in my neighborhood, and provided environmental regulations in housing. In my opinion, the government has taken the necessary steps towards correcting the housing market failures that have been in existence in the past. Negative externalities of goods and services cause market failures since people do not consider the consequential costs that other people will have. I have suffered a negative externality of pollution, traffic jams, and accidents caused by cars. I have also participated in causing these negative externalities owning a car myself and incurring personal costs such as fuel costs and the cost of purchasing the car. The government should come up with ways to effect the socially effective results of owning and driving a car.