What I Walked Away With From Economics – Essay
I have learned so much in Economics that it’s hard to write only two pages. I have decided to write about the top 10 things I have learned about this semester and probably taken for granted. I used to think that economics was about the cracks in between the lines, now I think of it as resourceful understanding. Starting with number 10 and working my way to number 1:
10.) The ten principles of economics. I learned about these things that I have always taken for granted. In ever thought about tradeoffs and the cost of something is what you give up to get it. I always just thought that was the way certain things work. I knew nothing about the invisible hand and how it helped out people like you and me everyday. I also never realized how much the government has to do with the economics of the United States.
9.) The circular flow diagram. I can’t help but look at this diagram and think about it and how it works just like a heart does. I see this diagram as using services such as labor, land, and capital as inputs and producing outputs such as a product for consumers. It’s almost exactly how a human heart works. Unoxygenated blood comes from the body and meets at the heart once entered through the heart it comes out oxygenated kind of like a finished product.
8.) Positive and Normative statements. Positive statements describe how the world is and Normative describe how the world should be. I think normatively. I always feel that the world should be like something in a book and not like it is. I think it’s good to not only think normatively but also to think Positively. You need to be able to see alls sides of a problem before you can solve it. You need both views to see the world clearly, not only the way it is but how it should be to make it better.
7.) Opportunity cost. What you give up to obtain something. Everything you do everyday is an opportunity cost. It makes you really think about if what you are doing in your life is really worth it. Making every minute count is what I take out of it.
6.) Trade. Trade cannot only help you but others as well. Whoever has absolute advantage has better productivity and comparative advantage has the best opportunity cost. Trade can make everyone else’s life easier.
5.) Normal and Inferior Goods. Normal goods are those, which an increase in income leads to an increase in demand. Inferior goods are those, which an increase income leads to a decrease in demand. I looked at this like if I got a better job I would never eat at white castle again, I would eat at Cheeseburger in Paradise.
4.) Surplus and Shortage. When your supply is too much you have a surplus, which does not really help you. When you do not have enough you have a shortage. When you have just the right amount you have an equilibrium quantity.
3.) Elasticity. When you have an inelastic demand for something you are willing to pay whatever for it. When you have an elastic demand for something the price is a little more reasonable.
2.) Tax. The government wants its so-called fair share of money too. If a demand is more inelastic the burden of taxation will be put on the consumer. If the tax is more elastic the producer and the consumer will share the tax.
1.) Supply and Demand. Everything listed above has to do with supply and demand. Supply is what a producer has to offer a buyer, that buyer will decide whether or not he has a demand for it. The law of supply and demand states that the claim that the price of any good adjusts to bring the supply and demand for that good into balance.