ECON312N Principles of Economics
Week 1 Discussion
Scarcity or the Invisible Hand
Required Resources
Read/review the following resources for this activity:
Textbook: Chapter 1, 2
Lesson
Minimum of 1 scholarly source (in addition to the textbook)
Introduction
Select and respond to one of the following options:
Option 1: What assumptions about the economy must be true for the invisible hand to work? To what extent are those assumptions valid in the real world? Do these conditions hold in the social service industries?
Option 2: As illustrated in the text, society must make trade-offs in terms of what society produces. Examine these trade-offs in the context of the production possibilities frontier. Use a social service industry such as healthcare as an example. Make sure to address productive efficiency, allocative efficiency, and opportunity costs.
Follow-Up Post Instructions
Respond to at least one peer. Respond to a peer who chose the option you did not choose. Further the dialogue by providing more information and clarification.
Writing Requirements
Minimum of 2 posts (1 initial & 1 follow-up)
Minimum of 2 sources cited (assigned readings/online lessons and an outside scholarly source)
APA format for in-text citations and list of references
ECON312N Principles of Economics
Week 2 Discussion
Demand, Supply, and Market Equilibrium for Labor and Wages
Required Resources
Read/review the following resources for this activity:
Textbook: Chapter 3, 4, 5
Lesson
1 source including local wage information (can be the BLS site)
Minimum of 1 scholarly source (in addition to the textbook)
Optional Resource
Link (website): Bureau of Labor Statistics: Occupational Employment Statistics (Links to an external site.)
Introduction
Research the local job market including the wage for the position you want when you graduate. Data is available from the Bureau of Labor Statistics; however, you can use other wage information sources. In your post, address the following:
Indicate the position, the national average wage, and the wage in your specific geographic location.
Examine the factors that influence the wage.
What specific local factors influence the wage and in what direction?
What national factors influence the wage and in what direction?
Was the data what you expected? Why or why not?
How does this information impact your choices about your future career and employment or relocation plans?
ECON312N Principles of Economics
Week 3 Discussion
Concepts of Cost Structures under Perfect Competition
Required Resources
Read/review the following resources for this activity:
Textbook: Chapter 7, 8
Lesson
1 news article
Minimum of 1 scholarly source (in addition to the textbook)
Initial Post Instructions
For the initial post, address the following:
Locate a news article discussing a social services business failure or closure. Using the concepts in the lesson and Chapter 7, identify the root causes for the failure, examining the short run and long run. Use graphs if necessary.
Assume the business was in a perfectly competitive market. How do firms in a perfectly competitive market determine price and profit-maximizing output levels? How did these conditions affect the decision to close?
ECON312N Principles of Economics
Week 4 Discussion
Market Concentration of Firms and the Determination of Price and Output
Required Resources
Read/review the following resources for this activity:
Textbook: Chapter 9, 10
Lesson
Minimum of 1 scholarly source (in addition to the textbook)
Initial Post Instructions
Consider the following statement:
Firms in the healthcare industry do not seem to have features of a perfectly competitive market structure and, therefore, must not be classified as such. Those firms fall somewhere within the continuum from monopolistically competitive and oligopoly markets to monopoly markets (specifically regional monopolies).
For the initial post, decide if you agree or disagree with the statement.
If you agree with this statement, provide at least two examples of firms in the healthcare industry (pharmaceutical companies, medical centers, insurance companies, etc.), and identify the features the firms you selected have that make you believe that they should be classified in one or several of the following market structures: monopolistically competitive and oligopoly market structures; monopoly market structures.
If you disagree with the statement, name at least two firms in the healthcare industry (pharmaceutical companies, medical centers, insurance companies etc.), and provide reasons why those firms you selected can be classified as perfectly competitive firms.
Note: The two examples must come from different industry groups. For example, both firms cannot be insurance companies.
ECON312N Principles of Economics
Week 5 Discussion
Unemployment and Skills Mismatch
Required Resources
Read/review the following resources for this activity:
Textbook: Chapter 21
Lesson 1, 2
Link (website): Occupational Outlook Handbook (Links to an external site.)
Minimum of 1 scholarly source (in addition to the textbook)
Introduction
In the last few years, there has been a debate about the main causes of the high rates of unemployment during the Great Recession (2008-2009). One line of argument is that there is a misalignment between the skillsets required by employers and the skillsets of job seekers, which continues to keep millions of Americans out of the job market. In an article published in MIT Technical Review Business Report, Majcher (2014) reported that "employers have 300,000 unfilled manufacturing jobs," which she attributes to the lack of the required skills needed in the manufacturing sector (para. 1).
Since 2010, there has been a steady decrease in the unemployment rate. In fact, in its April 2018 Hiring and Unemployment report, the Labor Department presented the unemployment rate as 3.9%. Despite this low rate of unemployment, there is still a significantly large number of people who cannot find jobs. In research conducted by LiveCareer, it was reported that "companies claim they cannot find workers with the right skill sets, while workers complain that their existing skills are becoming obsolete due to technological change and automation of various job functions. Less skilled workers simply are not fit for many jobs in the digital age." (LiveCareer, 2018, para. 1). The lack of well trained and skilled workers, some worry, may have adverse consequences on the performance of the U.S. economy as the economy grows and the productivity of labor becomes increasingly crucial in sustaining the growth. As pointed out in their 2016 report, the Business Roundtable - an association of chief executive officers of America's leading companies - surveyed its members and reported that "as America continues to recover from the worst economic recession since 1930, our economic growth is hindered because the skills of today's workers have not kept up with requirements of current and future jobs" (p. 7). This state of affairs, the report argues, is caused by the fact that "the working-age of the population is growing at half the rate of the past century; labor force participation is holding steadily below that of the past three decades and baby boomers are retiring in record numbers" (p. 7). The report went on to state that "no amount of automation or technological innovation can overcome these headwinds if our nation does not take action to ensure that our labor force holds the skills needed for today's jobs and for the future" (p. 7).
Initial Post Instructions
For the initial post, select a field where there is a shortage in the labor force (or there will be a shortage in the future). This information can be found in the Occupational Outlook Handbook published by the Bureau of Labor Statistics (noted in the Required Resources section). Then, address the following:
Determine the impact of the shortage in the field you selected.
What educational and job training policy proposals would you like to see implemented to help resolve the apparent skills-mismatch in the field you selected?
ECON312N Principles of Economics
Week 6 Discussion
Inflation in the Costs of Education and Healthcare
Required Resources
Read/review the following resources for this activity:
Textbook: Chapter 22
Lesson
Link (website): Bureau of Labor Statistics: Employment Situation (Links to an external site.)
Minimum of 1 scholarly source (in addition to the textbook)
Introduction
The Consumer Price Index (CPI) is a measure of the average monthly change in the price for goods and services paid by urban consumers between any two time periods. There are three steps in calculating the CPI.
The cost of the CPI market basket is calculated at base year prices.
The cost of the CPI market basket is calculated at current period prices.
The CPI is calculated for the base period and the current period.
The CPI is used to calculate changes in the cost of living and changes in the value of money. To measure these changes, we calculate the inflation rate, which is the percentage change in the price level from one year to the other. Due to the volatility in the prices of certain goods and services, the CPI basket (that includes all items that Americans spend most of their incomes on) might not be a reliable measure of inflationary and deflationary periods. To get a more accurate measure of CPI, therefore, food and energy items are removed from the basket to get Core CPI (Consumer Price Index for All Urban Consumers: All Items Less Food & Energy [CPILFESL]). This measure of the cost of living is often used as a benchmark for changes in the cost of other goods and services.
Two key components of CPI are the costs of education and healthcare. These two variables constitute what is known in economics as human capital, which is a key determinant in the productivity of labor, and hence, essential for economic growth and development. In the last few decades, the value of these variables has risen faster than the value of the general level of prices (CPI), which they are subsets of. According to David Wiczer (2017), "the price of medical care has grown at an average annual rate of 5.3% while the entire basket (headline CPI) has grown at an average annual rate of 3.5%." He goes on to state that "In the past 20 years, in the regime of stable inflation, headline CPI has grown at an average annual rate of 2.2%, whereas the price level of medical care has grown at an average annual rate of 3.6% - about 70% faster" (para. 1).
As shown in Figure 1, the increases in the costs associated with Health and Education have consistently exceeded the overall cost of living during the period of observation (2000-2018). There are many consequences for the high cost of healthcare and education, not least of which are skipping expensive but necessary medical procedures, discouragement from pursuing career enhancing educational requirements, or resorting to educational loans with the potential for life-long financial consequences.
Graph showing increases in the overall cost of living (CPI) vs. increases in the costs of health and education
Figure 1: Increases in the Overall Cost of Living (CPI) Vs. Increases in the Costs of Healthcare and Education.
Initial Post Instructions
For the initial post, you will focus on health or education. Address the following, providing specific examples within the area of focus, perhaps what you have seen in your own communities as well as research:
What are the implications (including tradeoffs and effects) of the high cost of either health or education on the human capital needs of the U.S. economy?
What policies would you recommend to rein in these costs or at least to slow down their rate of increase?
ECON312N Principles of Economics
Week 7 Discussion
The Federal Deficit and National Debt
Required Resources
Read/review the following resources for this activity:
Textbook: Chapter 27, 28, 30
Lesson
Minimum of 1 scholarly source (in addition to the textbook)
Optional Resources
Link (website): U.S. National Debt Clock (Links to an external site.)
Introduction
The federal debt is symptomatic of the nation's persistent budget deficits as the national debt is the accumulation of budget deficits. Deficits grew steadily during the Great Recession when there was a significant shortfall in government revenue, which required that the government pursue an expansionary fiscal policy to stimulate the economy. The recession is now over, but the Trump administration, continues to pursue deficit spending. In a contribution to Forbes magazine, Chuck Jones (2018) points out that the U.S. Federal deficit was $587 billion in Obama's last year in office, and it grew to $666 billion in the first year of Trump's presidency. The Trump Administration's Tax Reform plan and the two-year bipartisan budget, which passed in February 2018, are estimated, by many accounts, to cause the federal deficit to exceed 1 trillion dollars by 2020 (Jones, 2018). The implication of this growing deficit is a further increase in the national debt.
From 1965 to through 2019, there has been a persistent increase in the federal debt. This trend became more pronounced during (and in the aftermath of) the recession of 2008-2009. As shown on Figure 1, in September of 2017, for example, the national debt rose to 20.24 trillion U.S. dollars. This disturbing increase in the federal debt is likely to increase the per capita debt burden for each American citizen. According to Statistica (2018), if the debt owed in 2016 were distributed to every American citizen, the amount owed per capita would be 60,470 U.S. dollars. The current figure is available at the U.S. National Debt Clock website.
Graph of total public debt
Figure 1: Federal Debt: Total Public Debt
As the U.S. federal debt increased over the years, so did the federal debt as a percentage of GDP. From 1965 to 2018, there has been a general increase in the federal debt as a percentage of GDP. Remarkably, this increase was very pronounced during (and in the aftermath) of the recession of 2008-2009, after a brief decline from 1995 to 2002. As shown on Figure 2, in the fourth quarter of 2017, the Debt to GDP ratio was 104%. The ratio compares what the U.S. owes to what it produces, and it serves as an indication of the U.S.'s ability to pay its debt. This number can also be interpreted as the number of years it would take for the U.S. to pay back its debt if the nation's GDP is used entirely to pay back its debt (Statistica, 2018).
Graph of total public debt as a percent of GDP
Figure 2: Federal Debt: Total Public Debt as a Percent of GDP
Initial Post Instructions
For the initial post, address the following:
Do you agree that the constitution should be amended to include a balanced budget requirement? Why or why not?
If you agree with a constitutional amendment, can you identify one reason why some people may be opposed to it? What proposals would you make to allay the concerns of those people?
If you disagree with a constitutional amendment, can you identify a line of argument – made by the proponents of the constitutional amendment – that you find compelling? What do you find persuasive about that line of argument?
ECON312N Principles of Economics
Week 8 Discussion
International Trade
Resources
Read/review the following resources for this activity:
Textbook: all chapters
Lesson
Minimum of 1 scholarly source (in addition to the textbook)
Initial Post Instructions
Choose one of the following options:
Option 1: Global Trade and the Quality of Life
It has been said that global trade improves the quality of life. Using research, argue either for or against the statement that global trade improves the quality of life.
For the initial post, address the following:
Do you believe that this statement is true? Why or why not?
Are there examples of global trade lessening the quality of life in a particular country or region? Provide details to support your answer.
Does everyone benefit equally from global trade? Why or why not?
Option 2: International Agreements and Organizations
Choose one of the following agreements or organizations to address trading concerns:
The World Trade Organization (WTO)
The International Monetary Fund (IMF)
The World Bank
North American Free Trade Agreement (NAFTA)/United States-Mexico-Canada Agreement (USMCA)
The European Union (EU)
The Asia-Pacific Economic Cooperation (APEC)
For the initial post, address the following questions:
What has this agreement or organization done to promote trade?
What would business be like without this agreement?
What countries are benefiting most from the organization or agreement?
Are any countries hurt by the organization or agreement? Why or why not?
What recommended changes would you provide?
