In many large cities you can now use your cell phone to call Uber or Lyft instead of hailing a taxi.  Would you expect this to affect the prices of taxi medallions (that is really the supply of taxis)?  Why or why not?  

Yes, while Uber and Lyft continue to dominate the market in transportation compared to taxis, the demand for taxi medallions will continue to decrease. This will cause the supply to decrease because there is not a need or want for those taxis because Uber and Lyft provide a similar service for a cheaper price while keeping their apps user friendly. By doing this Uber and Lyft are increasing both their supply and demand. For taxis to compete with what Uber and Lyft have to offer, they will have to lower their prices to a level that can compete with these two apps.

Can you think of an example where you watched the supply of a good or service change rapidly?  (For example, a new hotel or restaurant opened.)  Based on the chapter what would you expect to see happen? Why?

A really good example I found for this question that is relevant especially today, is the supply of a well thought out brand called Yeezy. The brand sells very limited quantity sneakers that are extremely in demand for luxury goods. Today the brand actually released their sneakers in mass quantities to the public. This means it is no longer as limited as it was in the past. Before the brand decided to do this, there was a whole resell market for these shoes. If a consumer were to have the opportunity to purchase these shoes at retail price, they could easily sell them for 3 times their original value. Today while the brand decided to release these sneakers, the demand suddenly fell because they were no longer limited items to consumers.

Give another example of a concept from this chapter.  For example I used AirBnB to rent an apartment in San Francisco a few years ago.  How did AirBnB affect the supply of short term room rentals in San Francisco? How about the supply of long term rentals?

An example of a concept from this chapter is Netflix. When Netflix was released to the public, there was a slow decline in rentals for movies and entertainment like Blockbuster. Netflix achieved this by creating a month by month payment bases instead of paying for each individual movie rented at a Blockbuster. In my opinion Netflix basically created this large supply of movies that were in demand by the people, and offered all of them for the same rate to every individual, rather than paying for each separate movie. This caused Blockbuster to go out of business with only one store left.

1. What are two weaknesses in the buy local argument?

Two weaknesses I found in the buy local argument :

One weakness in the buy local argument is that buying local is an inefficient action to the economy. The video gives an example of how in the past, society was not able to communicate very well because of distance. This lead to inefficient trade because individuals were not able to buy certain products that other countries specialized in.

Another weakness in the buy local argument is that if individuals were to only buy local due to the fact that it is local, it would decrease specialization which ultimately would lead to higher prices and lower variety of choice when trying to buy a product.

1. After watching the video are you still going to make an effort to buy local on occasion?  Why or why not? 

Like it is said in the video, I will try my best to make an effort to buy local if the product is a quality and it is the product that I am looking for. If an individual goes out of their way to purchase a product just because it is local it doesn’t create a healthy economy because the products that are preferred and superior will not receive the revenue.

1. What economic strengths of buy local are not mentioned in the video?

An economic strength that is not mentioned in the video is that when individuals buy local in their community, it helps not only the business that is local but the community as a whole because these businesses can provide sponsorships and give back to the community.

1. From the perspective of Colorado, is trade with Wyoming different from trade with China? Why or why not? Keep in mind that Colorado doesn’t trade with Wyoming.  Individuals in Colorado purchase items produced in Wyoming (coal probably. :-))

From the perspective of Colorado, trade with Wyoming is completely different from trading with China. The difference comes to imports and exports from the United States economy and the Chinese economy. If Colorado were to trade with Wyoming it is similar to buying local but in the country rather than international. This helps the United States economy.

1. How does the use of a very simplified model of the economy such as those found in a production possibilities frontier help you to understand the economy? Did you find it useful?

A simplified model of the economy like the ones found in a production possibilities frontier help individuals understand the economy by allowing assumptions of simplified scenarios so that we can learn the reality of the situation. Instead of adding multiple variables that may cause different scenarios, making assumptions that only specific variables apply, makes the situation more simple to understand. It is like eliminating numbers from a simple math equation like 1+1. Instead of the idea of the numbers there, we would try to understand the idea of combining the two numbers before bringing in the variables. Although some of these things seem radical, like assuming an economy sells only two products, it makes sense to show the root of the problem to better understand its principle so that it can be applied to larger problems.

1. Give an example of something you believed or heard frequently about the economy before reading this chapter.  Did your belief/the comments lead to positive or normative statements? Why? And why does it matter? An example of this that is in the news a lot is international  trade – we hear it talked about in terms of winners and losers, but when you make a trade with your local grocery store you both win.  In fact, trades don’t occur unless both the buyer and the seller “win”. For other economic “myths” just google “economic myths”. 

Two very frequent things that are said about the economy are, “the minimum wage is too low” or “genders should be paid equally.” When responding to these type of questions it really depends on who I am specifically answering to. If I have to be descriptive or I am talking to an individual that I am trying to persuade, I usually avoid normative statements. Most of the time my belief or comment leads to a normative statement though. The reason why I do this is because I feel like after responding to someone with a normative statement, it opens up the conversation to a better debate.

1. What in this chapter made you think about an economic concept differently than your previous beliefs?  

During this chapter, I felt like I learned many different types of economic concepts which led me to change my previous beliefs. After taking microeconomics, Interestingly enough, I thought that the two would be quite different. But after reading this chapter about the 10 Principles of Economics, I realized that the two are quite similar but have their differences as well. The two subjects are definitely tied together to create a larger concept of economics, but I was slightly surprised because these 10 principles of economics apply to all forms of economics, not just micro and macro economics.

1. What new questions do you have now about the US economy based on this chapter?

After reading the chapter, I have not formed any new questions as of yet. I feel like the reason why I don’t have any questions is because the material from this first chapter feels like I am getting a similar introduction into microeconomics. Although this chapter feels like a refresher to microeconomics, it does help me build my confidence in knowing that I will be able to apply these same principles while studying in this macroeconomics course. The only question I have isn’t related to the US economy but more on how related micro and macro economics really are. I’m hoping to gain a better understanding of both while taking the course.  
 

After taking a break I’ve thought of a question relating to the US economy.

When it comes to the second principle of economics, how does a person figure out what is worth giving up to get? In other words, what type of factors determine risk and reward?

Thanks for joining me!

Good company in a journey makes the way seem shorter. — Izaak Walton