Difference between revisions of "Talk:Economics"
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== Enter your questions about economics here == | == Enter your questions about economics here == | ||
| − | :How does economic theory explain why anyone ever gives anything but money as a gift? | + | :1) How does economic theory explain why anyone ever gives anything but money as a gift? |
:If someone gives me (say) ''The New Annotated Sherlock Holmes: The Complete Short Stories'' I might be pleased, but if someone gave me $95 I could ''buy'' ''The New Annotated Sherlock Holmes: The Complete Short Stories,'' in which case I would be just as pleased. Or, I might use the money to buy something different which I liked better. Or, I might know of a place to buy it at a discount, in which case I could have my book and extra money, too. | :If someone gives me (say) ''The New Annotated Sherlock Holmes: The Complete Short Stories'' I might be pleased, but if someone gave me $95 I could ''buy'' ''The New Annotated Sherlock Holmes: The Complete Short Stories,'' in which case I would be just as pleased. Or, I might use the money to buy something different which I liked better. Or, I might know of a place to buy it at a discount, in which case I could have my book and extra money, too. | ||
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:If someone gives me money, the ''worst case'' is that I do not know of anything that would please me more than the intended gift. In every other case, I can do better with the money than with the gift. Therefore, it would seem that the economist's "rational man" would always prefer to give and receive the money. [[User:Dpbsmith|Dpbsmith]] 15:51, 8 February 2007 (EST) | :If someone gives me money, the ''worst case'' is that I do not know of anything that would please me more than the intended gift. In every other case, I can do better with the money than with the gift. Therefore, it would seem that the economist's "rational man" would always prefer to give and receive the money. [[User:Dpbsmith|Dpbsmith]] 15:51, 8 February 2007 (EST) | ||
| − | :Consider a company whose stock pays no dividends, and whose management's states that their intention is not to pay them in the future. The present value of a future stream of zero dividends is zero. How does economic theory explain why people are willing to buy such stock? [[User:Dpbsmith|Dpbsmith]] 16:39, 8 February 2007 (EST) | + | :2) Consider a company whose stock pays no dividends, and whose management's states that their intention is not to pay them in the future. The present value of a future stream of zero dividends is zero. How does economic theory explain why people are willing to buy such stock? [[User:Dpbsmith|Dpbsmith]] 16:39, 8 February 2007 (EST) |
Revision as of 21:39, February 8, 2007
Enter your questions about economics here
- 1) How does economic theory explain why anyone ever gives anything but money as a gift?
- If someone gives me (say) The New Annotated Sherlock Holmes: The Complete Short Stories I might be pleased, but if someone gave me $95 I could buy The New Annotated Sherlock Holmes: The Complete Short Stories, in which case I would be just as pleased. Or, I might use the money to buy something different which I liked better. Or, I might know of a place to buy it at a discount, in which case I could have my book and extra money, too.
- If someone gives me money, the worst case is that I do not know of anything that would please me more than the intended gift. In every other case, I can do better with the money than with the gift. Therefore, it would seem that the economist's "rational man" would always prefer to give and receive the money. Dpbsmith 15:51, 8 February 2007 (EST)
- 2) Consider a company whose stock pays no dividends, and whose management's states that their intention is not to pay them in the future. The present value of a future stream of zero dividends is zero. How does economic theory explain why people are willing to buy such stock? Dpbsmith 16:39, 8 February 2007 (EST)