'Naked Economics Essay\r'

'Chapter 1: The Power of Markets\r\n•What argon the two basic assumptions that economists make roughly individuals and firms?\r\n•What is the parting and significance of prices in the food securities industry scrimping?\r\n•What’s so heavy(p) more or less a market miserliness anyway?\r\nMarket eachotment 3 / Assume rational utility- goopimizers 6 / hazard costs 9 / Profit max 11 / Prices allocate resources 12 / Barriers to presentation 14 / Market price, pricing end & adenine; price discrimination 15 / Lessons of markets 18\r\nChapter 2: Incentives Matter\r\n• relieve how each of the following relates to efficient outcomes in a market economy:\r\n-adverse pick\r\n-â€Å"perverse incentives”\r\n-principal-agent problem,\r\n-the prisoner’s dilemma.\r\n defective incentives lead to undesirable outcomes 23 / inventive destruction 36 / Tax & ampere; govt program disincentives 38\r\nChapter 3: presidential term and the Economy\r \n•In your own words, let off what an externality is.\r\n•Besides addressing externalities, what other beta and beneficial roles does government play in our market economy?\r\nExternalities 43 / Govt solutions to externalities 48 / Govt makes market economy possible †rights, laws / regulations 51 / Public goods 57 / Redistribution 59\r\nChapter 4: Government and the Economy II\r\n•What argon the main reasons why government should exactly take a limited role in a market economy?\r\nGovt inefficiency 63 / Govt allocation vs private allocation 67 / Effects of regulation 69 / Effects of taxation 74 / thick 78\r\nChapter 5: Economics of discipline\r\nWheelan explains that basic sparingal models assume that all parties deliver â€Å"perfect information.” How does â€Å"informational asymmetry” neutralize our market economy?\r\nAdverse pickaxe 81 / Firm screening 89 / branding provides information 90 / Branding versus commodities 92 / Signali ng mechanisms 93\r\nChapter 6: productivity and gentle Capital\r\n• afterwards reading Wheelan’s argument, do you take that Bill Gates should be so much richer than you? •Evaluate the following argument from p. 113: â€Å"We should not care rough the disturbance between rich and low-down as long as everybody is living better.”\r\nHuman capital 98 / Job innovation 103 / Effects of human capital on standard of living 105 / Productivity 107 / Income inequality 111\r\nChapter 7: Financial Markets\r\n• beg off how get-rich-quick schemes violate the most basic principles of economics.\r\n•What advice intimately investing in the stock market did you find most interesting and/or useful?\r\nPurposes of financial instruments 118 / Efficient markets & index funds 126 / Investment guidelines 132\r\nChapter 8: The Power of Organized Interests\r\n• wherefore have mohair farmers earned a subsidy from the federal government for decades?\r\nI nterest groups & politicians’ incentives 137 / approximately regulations benefit business 142 / Tyranny of the spatial relation quo 144\r\nChapter 9: Keeping business relationship\r\n•Why is a nation’s gross domestic product a good measuring stick of its economic well-being and progress?\r\n•Why is a nation’s GDP a poor measure of its economic well-being and progress?\r\nGDP: importance, trustworthy vs nominal, per capita 150 / GDP growth & wage growth 152 / GDP misses affable progress 154 / Recessions 156 / Fiscal & pecuniary policy 158 / Other â€Å"vital signs”: unemployment, poverty, inequality, govt budget, deficit, original acct, national savings, demographics 160\r\nChapter 10: The federal official Reserve\r\n•What is the primary role of the federal official Reserve?\r\n•What is the significance of this role?\r\n•What is deflation, and why is it worse than inflation?\r\n greatness of federal official 168 / Easy money causes inflation one hundred seventy / FOMC & monetary policy tools 172/ worry of policy decision-making 175 / Money 176 / largeness & effects 179 / Political mechanical press to allow inflation 182 / Deflation 184\r\nChapter 11: dole out and Globalization\r\n•What is the â€Å"good news about Asian sweatshops”?\r\nBenefits of hatful 187 / Comparative favor & specialization 190 / Losers from trade 191/ Protectionism 193 / Trade raises real incomes 195 / Trade benefits for poor countries 196 / Cultural homogenization 199 / Sweatshops 201\r\nChapter 12: increment Economics\r\n•After reading this chapter, what do you believe are the two superlative obstacles preventing poor countries from becoming rich?\r\nImportance of policies (vs resources) 206 / Effective development policies 208 / Exchange evaluate 217 / IMF 225\r\nEpilogue: Life in 2050\r\n•What economic question do you have about behavior in 2050? About nowâ€℠¢s economy? About life in general?\r\n'