Gross domestic product The economic growth rate is calculated from data on GDP estimated by countries' statistical agencies. The rate of growth of GDP per capita is calculated from data on GDP and people for the initial and final periods included in the analysis of the analyst.
However, economics has an impact on every moment of our lives because, at its heart, it is a study of choices and why and how we make them. Scarcity You implicitly understand scarcitywhether you are aware of it or not.
Simply put, the world has limited means to meet unlimited wants, so there is always a choice to be made. For example, there is only so much wheat grown every year.
Some people want bread; some people want cereal; some people want beer, and so on. How do we decide how much flour should be made for bread? One answer is a market system. Supply and Demand The market system is driven by supply and demand.
This demand means you can charge more for beer, so you can make more money on average by changing wheat into beer than grinding that same wheat into flour. More people start making beer and, after a few production cycles, there is so much beer on the market that prices plummet.
This extreme and simplified example does encapsulate the wonderful balancing act that is supply and demand. The market is generally much more responsive in real life, and true supply shocks are rare — at least ones caused by the market are rare.
Costs and Benefit The concept of costs and benefits encompasses a large area of economics that has to do with rational expectations and rational choices.
In any situation, people are likely to make the choice that has the most benefit to them, with the least cost — or, to put it another way, the choice that provides more in benefits than in costs. Going back to beer: If demand is high, the breweries of the world will hire more employees to make more beer, but only if the price of beer and the sales volume justify the additional costs to the payroll and the materials needed to brew more.
This extends far beyond financial transactions. University students perform cost-benefit analysis on a daily basis, by focusing on certain courses that they believe will be more important for them, while cutting the time spent studying or even attending courses that they see as less necessary.
Although people are generally rational, there are many, many factors that can throw our internal accountant out the window. Advertising is one that everyone is familiar with.
Commercials tweak emotional centers of our brain and do other clever tricks to fool us into overestimating the benefits of a given item. Some of these same techniques are used quite adeptly by the lotteryshowing a couple sailing a yacht and enjoying a carefree life.
This image and its emotional message "this could be you" overwhelm the rational part of your brain that can run the very, very long odds of actually winning. So, cost and benefits may not rule your mind all the time. Everything Is in the Incentives Incentives are part of costs and benefits and rational expectations, but they are so important that they are worth further examination.
Incentives make the world go round, and sometimes go wrong. If you are a parent, a boss, a teacher or anyone with the responsibility of oversight, and things are going horribly awry, the chances are very good that your incentives are out of alignment with what you want to achieve.
This particular brewery has two sizes of bottles: The owner wants to increase production, so he offers a bonus to the shift that produces the most bottles of beer in a day. Within a couple of days, he sees production numbers shoot up from 10, bottles a day to 15, However, he is soon deluged with calls from suppliers wondering when orders of the 1L bottles are going to come.
The problem, of course, is that his incentive focused on the wrong thing — the number of the bottles rather than the volume of beer — and made it "beneficial" for the competing shifts to cheat by only using the smaller bottles.No mobile devices in your classroom?
No worries! You can enjoy Nearpod from any web browser:) Create, engage, and assess your students in every lesson! The Hedgehog Concept is developed in the book Good to Great. A simple, crystalline concept that flows from deep understanding about the intersection of three circles: 1) what you are deeply passionate about, 2) what you can be the best in the world at, and 3) what best drives your economic or resource engine.
Economic Tools and Concepts Angela Stafford University of Phoenix Economic Tools and Concepts Healthcare uses Economic concepts and tools to regulate the ease of .
In France, John Baptist Say has the merit of producing a very superior work on the subject of Political Economy.
His arrangement is luminous, ideas clear, style perspicuous, and the whole subject brought within half the volume of [Adam] Smith's work. Custom Economic Tools and Concepts Essay Economic tools are elements that are used in the day to day activities of running the economy.
A theory by Mosby medical encyclopedia defines Health Economy as “the study of supply and demand of health care resources and the impact of health care resources on a population”. Islam, Muslims and Islamic civilization are under siege in America. Subsequent to the tragic incidents of September 11, Afghanistan and Iraq wars, ISIS’s barbarism and Paris shooting, Islam both as religion and community has witnessed some of the worst attacks upon its heritage and legacy unprecedented in the previous history.