Changes

'''2.'''Going to McDonald’s incurs more transaction costs (going out to eat almost always will). Two transaction costs are workers’ salaries and cost of the meal being served to you already cooked, like a delivery charge. Overall eating at home will be cheaper. (For example a whole pound of hamburgers at the supermarket is often cheaper than one McDonald’s sandwich.)

'''1.'''A good not listed in the lecture is a [[computer]]/electronic component. A service not listed is a bank account with an opening/low balance fee.

'''3.'''Scarcity could be defined as the quality of monetary value attached to a good or service. Increases in scarcity usually mean increases in price (supply and demand). For example, during a hurricane, goods like drinking water and gasoline become scare in the regular sense of the word, leading to sudden price hikes and even price gouging. Extra credit: People might exaggerate scarcity in their minds when they are influenced by advertising which implies scarcity. For example, at one time Kentucky Fried Chicken was failing, so they raised their prices! This made the product appear to be of more value, and their sales rose. Or people might exaggerate scarcity when the good in question has an emotional value of some kind, such as a dollar store item identical to one given by your relative, perhaps.

'''2.'''Going to [[McDonald’s]] incurs more transaction costs (going out to eat almost always will). Two transaction costs are workers’ salaries and cost of the meal being served to you already cooked, like a delivery charge. Overall eating at home will be cheaper. (For example a whole pound of hamburgers at the supermarket is often cheaper than one McDonald’s sandwich.)

'''4.'''The “invisible hand” is sort of the collective mind of anyone involved in business or research. All the elements of the mind can work together, even unconsciously, and bring resources together efficiently. Oddly, it is often very difficult to make this process conscious, as in a planned economy, which is usually inefficient. Anything produced with many materials is an example of the invisible hand in use. Take a soda bottle. There is an astronomical number of people involved in its production. The oil drillers, the people who made the oil drillers’ equipment, the people who built the bottle factory, the people who built the components of the factory, the people who made the ink on the label, and the people who devise an efficient way of producing the bottle. There is actually very little coordination in the whole process but it still works.

'''3.'''[[Scarcity]] could be defined as the quality of monetary value attached to a good or service. Increases in scarcity usually mean increases in price (supply and demand). For example, during a hurricane, goods like drinking water and gasoline become scare in the regular sense of the word, leading to sudden price hikes and even price gouging. Extra credit: People might exaggerate scarcity in their minds when they are influenced by advertising which implies scarcity. For example, at one time Kentucky Fried Chicken was failing, so they raised their prices! This made the product appear to be of more value, and their sales rose. Or people might exaggerate scarcity when the good in question has an emotional value of some kind, such as a dollar store item identical to one given by your relative, perhaps.

'''5.'''Lk 12:13-21:Parable of the rich fool. A man with a large farm wanted to hoard his harvest so he decided to build new, large barns. Then God told the man that he was going to die that night and asked him “who will get what you have prepared for yourself?” The economic point is that storing the harvest rather than immediately selling it is less beneficial to both the buyer and the seller, as the future might render the harvest non-saleable (or perhaps buyers would be poorer and not able to pay as much). Spiritually, it repeats a rather recurring message: don’t keep your goods to yourself, share them with others, for your benefit and theirs.

 

'''5.'''Lk 12:13-21:Parable of the rich fool. A man with a large farm wanted to hoard his harvest so he decided to build new, large barns. Then [[God]] told the man that he was going to die that night and asked him “who will get what you have prepared for yourself?” The economic point is that storing the harvest rather than immediately selling it is less beneficial to both the buyer and the seller, as the future might render the harvest non-saleable (or perhaps buyers would be poorer and not able to pay as much). Spiritually, it repeats a rather recurring message: don’t keep your goods to yourself, share them with others, for your benefit and theirs.

'''6.'''“Caveat emptor.” To me this means that the buyer cannot trust the seller to be honest, rather the buyer must be a force for honest marketing and business. Ultimately the person who is handing his money over is the one who should find out if he is getting a good value or being ripped off, and in the process be a check against unfair selling practices.

'''6.'''“Caveat emptor.” To me this means that the buyer cannot trust the seller to be honest, rather the buyer must be a force for honest marketing and business. Ultimately the person who is handing his money over is the one who should find out if he is getting a good value or being ripped off, and in the process be a check against unfair selling practices.