Econ 312 Week 1 Homework Assignment

Week 1 Homework Assignment

Chapter 1: Questions: 2, 8, Problems: 1, 2

Q2) Cite three examples of recent decisions that you made in which you, at least implicitly, weighed marginal cost and marginal benefit.

• At the pump (premium or regular)

• Cheap date or all out (park or cirque du soleil)

• Change of shift and responsibilities (promotion or stay where its comfortable)

Q8) Why is money not considered to be a capital resource in economics? Why is entrepreneurial ability considered a category of economic resource, distinct from labor? What are the major functions of the entrepreneur?

• Money is not considered a capital resource because it is made of paper and its only true value is reflects in the status of its counties economic standing; it also fluctuates. Currency is a medium of exchange of more valuable resources between people who don’t exactly want to barter trade. Entrepreneurs are a scarce resource and a vital part of the economy; without them you have no one to create jobs and the economy fails because no one is buying or making. Entrepreneurial ability is distinct from labor because the labor is the actual doing of the work through physical or mental activities to produce goods and services, whereas the latter consists of the innovative drive and risks necessary to bring the idea to the forefront and jumpstart its hopeful endeavors.

P1) Potatoes cost Janice $1 per pound, and she has $5.00 that she could possibly spend on potatoes or other items. If she feels that the first pound of potatoes is worth $1.50, the second pound is worth $1.14, the third pound is worth $1.05, and all subsequent pounds are worth $0.30, how many pounds of potatoes will she purchase? What if she only had $2 to spend?

• 7lbs for $5.00 after purchase of 1st 2nd and 3rd lbs ($3.69) and 4lbs .30 each

• 6lbs for $2.00 .30 each

P2) Pham can work as many or as few hours as she wants at the college bookstore for $9 per hour. But due to her hectic schedule, she has just 15...