Question

As newly elected President of your school’s Economics Club, you have been put in charge of the Club’s annual budget of $5000. This budget is to be used to produce “services” for the Club’s members (everyone taking this Economics class). In the past, such services have included things like 1) guest speakers coming into class (who charge a fee for speaking); 2) tours of local businesses (transportation costs); 3) downloading economic statistics from the internet (connect time charges); 4) an end-of-semester party (all expenses paid from the budget); and of course, 5) the President’s salary. What issues do you need to consider as you decide how to allocate the $5000, while keeping in mind that any one of the items (especially item 5) might completely drain your budget? HINT: Write your answer by referencing the central coordination problems faced by any economic system.

Answer 1

As the President of the Economics club, it would be my duty to first of all provide the best economics experience to the members. For this two things of utmost importance are:

1. Guest Speakers

2. Local Tours

Guest Speakers are people of extraordinary experience in the field of economics and provides an insight into how theory turns into practical. They, with their wide experience and skillful knowledge will boost our minds to think out of the box and thus will ne my topmost priority.

Local Tours are the next important things to do. It helps the student to themselves get engaged into practical world. They can experience how businesses are conducted,what problems one van face during operations and all sort of practical stuffs.

Thirdly the allocation would be spend towards internet. This will keep is updated by the latest policy of Fed, what news is coming how NASDAQ and other indices are performing and how dollar is doing vis-a-vis other currencies. It will tell us about the potential boom and burst cycles and will also help to apply econometric tools in real world situation.

Fourth focus would be on the salary as it takes a lot of effort to bring everything together on one table and then serve it to the rest. Salary charged will be minimum or at the break even so that expenses incurred during aforementioned tasks can be recovered.

Last, but not the least the leftover funds will be used for party. A small get togather is all what you need at the end of the day.