Economics Homework One Answers - Student Thirteen

JonathanL

1) An example of a good not in the lecture would be a seed. Even though they are cheap, I picked them because they possess value for the future, especially those which form into fruit-bearing trees. Seeds are an excellent good because they have the potential to give back to you in the future, as the fruit produced from the trees is also a good. A service not mentioned in the lecture could be home security systems. You pay someone to "protect" your home from danger.

Excellent.

2.) Well it depends what you buy. If you buy 30oz steaks for the whole family, chances are that McDonalds is the cheaper option. Assuming you're eating a normal meal, however, it is far cheaper to eat at home then to eat out. Either way you incur the transaction cost of going to the grocery store or to the restaurant, so I am going to negate that cost completely (unless you are self-sufficient and own chickens, cows, and goats.) The thing is that even though you drive all the way to the grocery store, you can buy food for more than just one meal. In my experience I usually just buy Wendy’s for when I am hungry next, not for three or four days in advance. This question was quite clear. Stay home, save money, and don’t support pro-gay McDonalds.

Excellent answer.

3.) Scarcity, in its economic meaning, may have some merit. However, the way most American’s use the word scarce is a joke. You can get whatever you need to live in the U.S.A. You may not have everything you want, but you definitely will be able to find what you need to survive. Similarly, in a country like America where all the basic needs are met, the term “scarcity” really only applies to luxury items. Scarcity is falsely exaggerated in our country because people have all their basic needs already met and they have nothing else to do. When someone in America loses a special penny, they might go ballistic. Not surprisingly, people pay millions of dollars for “special” baseballs. I was just in Guatemala, a 3rd world country, and the last thing that they are worrying about there is historic baseballs. My point is that scare is a relative term. People are people, and regardless of where they are in society, their will always be something that they cannot obtain which will cause them to label it as a scarce item.

Good analysis, with a colorful example.

4.) The Invisible Hand was a term coined by the most famous economist of all time, Adam Smith. Basically the Invisible hand was a metaphor for how the free market should be run, by the people. Let the people decide how much goods and services should cost, with little government interference. More importantly, though, was that the Invisible Hand theory banked on that people would create out of necessity. That is why I know that the world is not running out of oil. If it was, we would hear far more about alternative energy.

Excellent.

5.) Luke 15:8-10 discusses how a single coin is so important to a woman that she is willing to sweep the whole house to find it. In the same way, God rejoices over one individual accepting Him as Lord and Savior.

Superb, will use as a model.

6.) Caveat emptor, or let the buyer beware, is the epitome of a successful free market. In other words, the only person you have to blame is yourself. No more blaming the manufacturer; if you were dumb enough to buy it, it's your fault. Only the intelligent survive. I would compare Caveat emptor to the electric fence: it only takes one time to learn.

Good, colorful explanation!

Superb work. 60/60. Great start!--Andy Schlafly 10:55, 13 September 2009 (EDT)