ECO 101 — Principles of Macro
In-class discussion questions
- What is the opportunity cost for you to come to class today? Was the expected benefit of coming to class for the person to your right worth the opportunity cost? How do you know?
- You have been at Disney World all day, and your legs are getting tired and you are a little hungry. Your partner points at a ride and says, "Let's do that!" Which of the following are part of the opportunity cost of going on the ride? (think on the margin)
- The cost of admission to the park
- The sadness you will cause your partner by not going on the ride
- Sitting down and having dinner
- The fact that if you do not go on the ride, you will probably regret it later
- Explain this quote from Milton Friedman: “Inflation is always and everywhere a monetary phenomenon.”
- Which of the following fields is most similar to economics? Explain.
- International trade
- Stock trading
- A politician tells you, "We need to do whatever it takes to make sure there is never another terrorist attack on the US." How would an economist respond to this? (hint: try to use the word "tradeoff")
- Your friend who is a shift manager at a branch of the Southern fast food chain Cookout tells you, "We could raise our prices by $.01 for everything, and no one would buy any less." How would an economist respond? (hint: try to use the word "incentive")
- Suppose that you like to run. You would rather run 30 minutes per day 4 days per week than never run. True or false: we know from this information that you will run at least 30 minutes per day 4 days per week. Explain. (hint: think on the margin)
- True or false: making abortions illegal will not decrease the number of abortions, because people will just keep having sex and already know whether they want to have kids. (hint: think about opportunity costs and other incentives)
- True or false: capitalism is the reason there are recessions, because the capitalists do not care about the plight of unemployed workers. Explain.
- True or false: if we see one big box store ("WallyMarket") that pays its employees $10/hour on average and another ("CostlierCo") that pays its employees $15/hour on average, then we can conclude that the owners of CostlierCo are more generous than the owners of WallyMarket. Explain.
- True or false: GDP per person (income per person) is a bad measure of human wellfare, because it does not include things like health, happiness, and friendships. Explain.
- Explain why we might think drugs (for medical purposes) are too safe or not safe enough.