Thursday, December 23, 2010

Post 17: Business Cycle Graphs

Graph 1: The graph uses great economic vocabulary words and uses colors to enhance the visual. The graph also has a labeled X and Y axis to further describe the business cycle. The only thing the graph lacks is a title.

Graph 2: This graph shows only one hump and therefore not expressing that the business cycle will repeat itself. It uses some mediocre vocabulary words and it's very bland being only black and white. Although the graph has a labeled X and Y axis, it fails to have a title.

Graph 3: The graph has a title and a labeled Y axis but not labeled X axis. It is very visually appealing however the graph only shows one hump.

I believe that graph 1 is the most successful created graph of them all because it shows the continuous nature of the business cycle. The graph also shows a "growth trend" line to show that although the economy will have a fluctuation between peak and trough, the economy will slowly increase over time. The colors and design of the graph makes it very visually appealing.

Tuesday, December 21, 2010

Post 15: Top 3 leading/coincident/lagging indicators

Leading indicators: - Economic indicator that changes before the overall economy has changed.
  1. Average weekly hours, manufacturing
  2. Average weekly initial claims for unemployment insurance
  3. Manufacturers’ new orders, consumer goods, and material
Coincident indicators: - Economic indicator that varies directly with the overall economy during the change.
  1. Gross Domestic Product
  2. Manufacturing and trade sales
  3. Personal Income
Lagging indicators: - Economic indicator that changes after the overall economy has changed.
  1. The value of outstanding commercial and industrial loans
  2. The change in the Consumer Price Index for services from the previous month
  3. The change in labor cost per unit of labor output
I believe that these are the top incators in the US economy because each of these greatly help to predict the future of the business cycle.
 I think that the best indicator is GDP and Average weekly initial claims for unemployment insurance because both of these help explain the economy at any given time. These two indicators will both show the total amount of product being produced in the US and show the unemployment rate which will be a good predictor for the business cycle.

Post 14: Reaction to business cycle videos

Although the first two videos were "silly," they were very educational as well. The "My Humps" video was both the msot educational and the msot entertaining. It contained a lot of the terms that I have or will learn. The "Business cycle rap" was silly but not as educational and the Qwiki video was educational but not silly. Therefore, the "My Humps" video was the most educational and fun to watch.

Monday, December 20, 2010

Post 13: 10 things I learned from the practice Quizzes

1. Although GNP is more accurate, most countries use GDP.
2. Government transfer payments aren't included in government spending.
3. The underground economy isn't included in GDP because the underground economy is either illegal activities or unreported legal activities.
4. Anything that does not deal with money (barter transactions, housework, or self-repairs) are considered non market activities.
5. The business cycle is the changes in the market economy and it includes 6 different phases.
6. War is considered an external factor that may change the business cycle.
7. Indicators predict the future of the business cycle whether they be lagging or coincident indicators.
8. The amount of capital stock to worker is called  the capital-to-labor ratio.
9.  A country's standard of living decreases without long term economic growth.
10. Economists usually measure growth per capita.

Post 12: To the Editor

To whom it may concern,

Although GDP is a roughly estimated amount of "Gross domestic product" it is a faulty indicator because it fails to include many products. Because GNP measures the output generated by a country's enterprises both in the US and outside it's boarders, it may be a better predictor since GDP only measures the total output produced within the US borders even if it's produced by the US's own firms or not. The only reason why the US uses the GDP as it's main estimator is because most other countries have already adopted the GDP estimator to predict their national product.  Because GNP calculates the total income of the country (GNP = GDP + NR (Net income from assets abroad (Net Income Receipts), it creates a more accurate representation of the nation's yearly economy which can be easily studies and analyzed to create trends and predictions.


Friday, December 17, 2010

Post 11: 4x4

Step 1: Calculate Consumption expenditures
Step 2: Calculate Government purchases
Step 3: Determine Gross private domestic investments
Step 4:  Calculate Net exports
Step 5: Put it all together

GDP = consumption + gross investment + government spending + (exports − imports)
GDP = C + I + G + (X-M).

-Final Output - Only value the final goods or services when calculating GDP
-Current year - Does not include used cars or secondhand clothing
-Output produced within a national border - Does not include products made outside the US

Post 10

Macroeconomics will be about the economy in broad terms. For example, the study of economics relating to the U.S. governemnt as a whole would be considered U.S. macroeconomics. Macroeconomics is really fascinating because of the variety of things to analyze. Economists constantly predict the economic future and reading about the future is always interesting. I hope to learn some of the parts of macroeconomics, how economists can predict the economic future, and to determine how easy it is to understand different parts of economics.

Tuesday, December 14, 2010

Post 9: 100 Word Essay: How has technology made our world a better place?

Technology invites us into a world of vast and unknown possibilities. It’s unlimited power has gifted mankind a better place to live. It’s curing hands heal us from diseases. It eases and lightens the challenges in our everyday life. Technology is more than what is tangible, it is the idea that enshrouds our society, making it a better place day by day. From the beginning man stepped foot on our world, he has discovered, invented, and designed, the basics of technology. Technology is human nature. From caveman to modern day business man, technology has greatly changed society for the better.

Friday, December 10, 2010

Post 8: Malcolm Gladwell

Companies are always trying to create the new flavor or design that appeals to people. The more variety a company has, the more someone will like one of their products. Also, with a variety of choices in the food industry, people will have to “taste test” the different variations to find their favorite taste leading to more people buying multiple products of a company.  If the prices are close, people chose their preferred products. Whether it be by taste, looks, style, or popularits, choices are made based upon many factors that appel to the consumers. Relating to Chapter 6, the Perfect competition market structure makes companies compete over something other than price. They have to make their product different, also called product differentiation,  so that it appelas to the consumer greater than the other related products. The Malcolm Gladwell video reminds me of the potato chip industry and the variety of flavors, choices and companies consumers can chose from.

Thursday, December 2, 2010

Post 7: 4 Varieties of Monopolies

Natural - Cable TV (Comcast)
Geographic - A general store in a remote community
Technological - Google
Government - US Postal Service

Post 6: Flip Card Review

Click the link below to see the U.S. Antitrust Legislation Flash cards

Here is another link to a website where you can create your own flashcards just by registering to the site.

Post 5: One Monopoly that I want to see broken up

I would like to see PSEG broken. In what seems to be only a few years, I'm going to own my own house or apartment and I'll have to pay a bill every month to PSEG. In New Jersey, they are a monopoly, and I would like to see other companies join into this market so that competition will create lower prices. This would benefit everyone in New Jersey who owns or rents a home including my family.

Wednesday, December 1, 2010

Post 4: 8 things I learned from the 3 quizzes

1. Consumers benefit most from competitive markets.
2. Sellers in monopolistic competition try to make their product different compared to other products in their competition.
3. Producers spend millions on advertisements.
4. Cartels are group of companies openly organizing to set prices.
5. Price leadership is the most common form of interdependent pricing.
6. "Trust" is another word for monopolies.
7. Standard oil was the best known trust that was broken up.
8. Laissez-faire is the philosophy that states that government doesn't interfere with the market.

Post 3: Pick 5 things I wanted to/actually did purchase

1. Pepsi - Oligopoly - There is almost no competition (Coca-Cola is the only other name brand other than a few store brands). They have a high control over price; however, if they increase the price to much than Coca-Cola will have more sales. It would be very difficult for a new company to create a soda and market it.

2. Wendy's Baconator - Monopolistic Competition - There are many competitors in the fast food and restaurant business. Wendy's has to compete with other popular fast food restaurants and therefore they have very little control over price. The second their price goes up, buyers won't bother purchasing their product. The level of entry is very possible.

3. Orbit Gum - Monopolistic Competition - There is a lot of competition. Orbit gum has to regulate their price with competing producers; therefore, they don't have a lot of say over price. The level of entry is very possible.

4. iPod Touch - Oligopoly - There is almost no competition. Apple has to only compete with a few other mp3 players. Because people prefer iPods over almost any other mp3, apple has a lot of say in the price. It would be very difficult to enter into the mp3 market.

5. Doritos - Oligopoly - The only competition is wise and utz; however, frito lay is known to be the "top dog" of the potato chip market. They have a large say over the price and every level is extremely difficult.