Indifference curves allow us to show how an individual consumer is willing to trade off one good for another without changing their overall level of satisfaction or well-being. There are three assumptions that are made about consumers that are central to the consumer choice theory. Explain what each of the assumption means in terms of consumer choice. For each one, provide an example of the assumption not holding in the real world

Using Concentric zone model, describe Jacksonville city in Florida.

Thank you.

A key reason that the systems paradigm works well is …

Select one:

a. Although we often prescribe boundaries to describe systems, there really are no boundaries; so we can add structure as needed to provide missing elements for the systems model

b. Systems are usually non-linear, which describes most behavior better than linear models

c. Systems models acknowledge there may be delays, which can affect the overall system behavior

d. Systems describe patterns of behavior rather than individual events

e. All of these are reasons the systems paradigm works

Bounded rationality refers to which idea below?

Select one:

a. People operating with perfect information will make perfect decisions for the good of the whole

b. Adam Smith’s concept of the “invisible hand” that says individuals acting in their own interest will move society effectively for society’s own economic benefit

c. Herman Daly’s concept of the “invisible foot” that says individuals acting rationally in the short-term will produce overall results that nobody wants

d. By satisficing we do enough to make the system sustainable

e. None of these

The principle of systems thinking illustrated best by the “Tragedy of the Commons" is self-organization.

Select one:

True

False

Escalation is a function of reinforcing loops. People at a party talking louder to overcome the rising volume of the crowd is an example of escalation.

Select one:

True

False

Increasing the capacity of intermediary stocks (buffers) to stabilize the system is one way to modify a system to produce more of a desired outcome.

Select one:

True

False

The murmuration video in the Weeks 4-5 lecture illustrates that the behavior of large systems emerges from the behavior of its subsystems.

Select one:

True

False

Banks often charge their customer's hidden or semi-hidden fees, such as late charges or over-draft fees. This is an example of which kind of systems trap?

Select one:

a. Competitive exclusion

b. Addiction

c. Rule beating

d. None of the above

e. All of the above, but primarily competitive exclusion

If you consider the emerging coronavirus epidemic in China, and the potential for global pandemic, which of these clichés best captures the systems nature of the problem?

Select one:

a. "A stitch in time saves nine."

b. "The rich get rich, and the poor get poorer."

c. "Don't put all your eggs in one basket."

d. "A spoonful of sugar makes the medicine go down."

e. None of the above

If the Fed wanted to slow down the economy, what would happen to the Federal Funds rate and to open market operations (buy or sell securities)?

Facebook is currently the leading social network; everyday thousands of people use this network to socialize. However, this practice is not secure from criminal minded predators, and a person’s privacy can be easily invaded. Discuss three other social problems associated with the use of Facebook, and recommend a solution for each problem.

Discuss the possible solutions to “heal” the economy once the great recession was in full force.

7. When the price of Coke rises, we see that consumers shift to purchase more Pepsi which is still cheaper. This statement describes:

    A)    An inferior good.    

    B)    The rationing function of prices.

    C)    The substitution effect.

     D)    The income effect.

The factor proportions, or Heckscher-Ohlin, theorem remains the most important single theory of why relative prices differ before trade, providing insights into the relationship between commodity trade and factor endowments.

1. Provide a common-sense conclusion that can be drawn from this theorem.

2. Discuss two implications of the factor proportions theorem.

3. The table below shows units of commodity X and Y that the U.S. and Mexico can produce with one- hour of labor time. Output Per Hour of Labor Commodity U.S. Mexico X (in units) 5 20 Y (in units) 30 5

a. Identify the commodity in which the U.S. and Mexico have a comparative advantage.

b. Suppose that the U.S. exchanges 15Y for 45X with Mexico. What is the TOT for commodity Y? How much would the U.S. and Mexico gain?

Compare and contrast the US GDP with another country's GDP ranking. What are the similarities/differences? What are the strengths/weaknesses of each country - look to analyze the composites that comprise GDP (consumption, investment, government spending, net exports).

A construction company is choosing between two backhoes. Options A is a wheel-mounted version, with an initial cost of $65,000, an expected life of 6 years, and a salvage value of $5,000. Option B is a trackmounted version, with an initial cost of $85,000, a 9-year life, and a salvage value of $10,000. Both machines will achieve the same productivity. The interest rate is 9%.

a) What is the EUAC of option A ($/year)?

b) What is the EUAC of option B ($/year)?

c) If the interest rate is 12%, which option is preferred (A or B)?

How are countries compared in terms of their economic development? Discuss.

Discuss why the policy rate of TCMB (turkish central bank), which is the one-week repo rate, may be misleading to measure the true cost of funding that TCMB charges to our commercial banks.

Question 1:

Suppose that your group is the executive sales team for Starbucks. The CEO has just proposed lowering the price of regular coffee and increasing the price of specialty coffee drinks. The belief is that our customers are sensitive to a price change of regular coffee but much less sensitive to a change in the price of specialty coffee. As such, your team is tasked with providing an analysis on this proposal. In order to provide your analysis, you need to find out if the CEO’s theory about customer behavior, and their sensitivity to price changes for regular and specialty coffee, is correct. In order to find out how sensitive customers are to a price change, you will need to calculate the price elasticity of demand, describe what that means, and evaluate the impact on revenues.

For this activity, use the standard percent change formula (also known as the point method).

You have been given the following data on prices and changes in quantity demanded.

Regular Coffee:

Current Price per cup: $2.00 and quantity sold per month is 1 million

Proposed Price per cup: $1.80 and estimated quantity sold per month is 1.5 million

Specialty Coffee:

Current Price per cup: $4.00 and quantity sold per month is 50 million

Proposed Price per cup: $4.40 and estimated quantity sold per month is 47 million

Part 1: Find the elasticity of demand for regular and specialty coffee.

Part 2: Find the total change in revenue for regular and specialty coffee.

Part 3: Use a demand curve graph to explain the change in revenue. You only need to show the demand curve on your graph.

You may upload a picture/file of your graph or use the creately template.

Question 2:

Suppose that your group is the executive sales team for McDonalds. The CEO has given your team a proposal; To analyze the impact of raising the price of the Big Mac by 10% and raising the price of regular fries by 10%.

In order to provide your analysis, you need to find out how sensitive customers will be to a price change of Big Macs and fries. In order to find out how sensitive customers are to a price change, you will need to calculate the price elasticity of demand, describe what that means, and evaluate the impact on revenues.

For this activity, use the standard percent change formula (also known as the point method).

You have been given the following data on prices and changes in quantity demanded.

  Big Mac:

Current Big Mac Price: $2

Current Big Mac monthly sales: 1 million

Estimated monthly Big Mac sales at the new price: 980,000

Regular Fries:

Current regular fry Price: $1.50

Current regular fry monthly sales: 2 million

Estimated regular fry monthly sales at the new price: 1.4 million

Part 1: Find the elasticity of demand for the Big Mac and fries.

Part 2: Find the total change in revenue for the Big Mac and fries.

Part 3: Use a demand curve graph to explain the change in revenue. You only need to show the demand curve on your graph.

You may upload a picture/file of your graph or use the creately template.