Microeconomics

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Microeconomics

• Fall 2007

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2-Minutes to Meet a Neighbor

• Name?
• Where from?
• Major?
• Hobbies?

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Me

• Dan
• From China, Chinese name Xiaodan Zhao
• Major
• international trade and finance,
• Monetary Economics
• Hobbies

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My Favorite Proverb

• He who knows not and knows not that he knows not
• is a fool... Shun him.
• He who knows not and knows that he knows not
• is a student... Teach him.
• He who knows and knows not that he knows
• is a sleep... Wake him.
• He who knows and knows that he knows
• is wise... Follow him

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C
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C
O
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Learn a foreign language

• Economics Language

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Transformation

• Team
• equipo
• Équipe
• Mannschaft
• Squadra
• Equipe
• ??????
• ???
• ?
• ??

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Textbook!
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THE SYLLABUS
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ECONOMICS ANDECONOMIC REASONING

• Chapter 1

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What Economics Is

• Economics is the study of how human beings
  coordinate their wants and desires, given the
  decision-making mechanisms, social customs, and
  political realities of the society.

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Economics, Scarcity, and Choice

• A good definition of economics
• Study of choice under conditions of scarcity
• Scarcity
• Situation in which the amount of something
  available is insufficient to satisfy the desire
  for it

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The Economic Problem

• Scarcity exists because individuals want more
  than can be produced.
• Scarcity the goods available are too few to
  satisfy individuals desires.
• The degree of scarcity is constantly changing.
• The quantity of goods, services, and usable
  resources depends on technology and human action.

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Does Bill Gates face the problem of Scarcity?
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Scarcity and Individual Choice

• There are an unlimited variety of scarcities,
  however they are all based on two basic
  limitations
• Scarce spending power
• Scarce time

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Examples of Scarcity theory application

• When you check out at bookstore or supermarket
  cashier, which line will you choose, the long
  line or the short line?
• How will you schedule your work time? During the
  class hour, off class hour or wont work at all
  until summer or holiday breaks?
• Why the attendance on the first day of class and
  on exam days is higher than on other days?
• -- because the opportunity cost of these days
  is much higher.

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Scarcity vs. Poverty

• Bill Gates certainly does not face poverty, but
  despite his wealth, he faces scarcity.
• Poverty is kind of scarce in spending power.