Economics 201 (Baker College Direct Credit)

Jesse Conlay - Article Review

            The June 14, 2012 issue of the newspaper known as “Marketplace” ties in with things we have learned so far in ECON201. On the bottom of page B10 it mentions how “the corn crop across the Midwest will be stressed by dry weather and above-normal temperatures.” This will cause a shift to the left in the supply curve, driving up prices. We learned about Supply and Demand in chapter 3. A solution to this problem could possibly be an increase in production of suitable substitutes for the crops affected. With this solution, there would be less stress on the supply of the affected crops, which would shift demand curve to a better position. The only issue with this solution is the possibility of stressing the supply of substitutable goods, which would cause the same problem as before.

                                                Rachelle Reihl   

Article Response

Inflation rates are the annual percent change in a price-index – typically the consumer price index.  The rate is positive when the aggregate price level is rising, which is inflation, and negative when the aggregate price level is falling, which is deflation. The consumer price index, from 2008 to 2012 shows a decelerating rate of price increases, as opposed to price drops, the current dip in headline inflation is seen as a temporary giveback from the commodity-price spike earlier in the year. Few economists are convinced, the core rates, which exclude food and energy, will move much. The view on inflation may be leading to the impact of slowdowns in economic activity and recessions have already begun in euro-zone countries and there are clear signs of a deceleration in emerging markets that have been the engine of global growth. Economic and financial problems in these bigger countries are significant enough to have an impact on U.S. economic growth. Rather than reversing quickly, slower price gains today may bring slowing growth tomorrow.

Caron White

Article Response

12-18-12

            On June 14, 2012, the Argentina government stated that dollars will become scarce.  This shortage, on a macro level, has put the economy on an uneasy path towards high inflation and slow growth.  Argentina leaders are trying to move the country over to peso’s but the country feels that the peso is too overrated and that switching over to peso will cause the country to move more towards the left than were they are now.  Personally I feel that Argentina should stay with dollars because the switch is causing a thriving black market in dollars and an import shortage.  Many of the citizens of Argentina will be hurt by the switch because as of right now some of the trade actions are making it hard to obtain necessary goods.  Right now Argentina’s inflation is projected to be at 24% annually, and only expected to grow by 2%, instead of the 7% from last year.  If Argentina stays with dollars, like I hope they do, they have a better chance at growing more as a country than if they change over to peso.

Article Response

            Americans love food that’s easy to get, easy to eat, and food that tastes good.  That explains why when Popeyes Louisiana Kitchen started cooking “ip’ns”, they sold like crazy.  The demand for their chicken pieces went up so well, that the supply could not keep up.  Other companies soon started to sell them, such as McDonald’s, Whataburger, and KFC.

            An issue with such a heavy production of chicken bites is that, eventually, people are going to slowly stop buying them, so the demand is going to go down.  The issue with the lack of demand is that the supply is too great, so the equilibrium shifts to match the curves.  While these chicken bites sold like crazy at first, after a while customers slowly gravitated back to their original menu choices.  When the demand for an item goes down, either the company continues to make as many as they were when the item was popular which will cause a surplus, or they will slow down with their production to match the demand curve, which moves the equilibrium.

            If the company continues to produce chicken bites at the same rate that they were when the bites were popular, it will affect their company greatly.  They will be making too much of something that isn’t selling, so they would be wasting money.  It would not increase their profit to try and sell a ton of chicken bites if the consumers don’t want to buy them.

(Edited by John Coon - original submission Tuesday, December 18, 2012, 11:23 AM)

Ashley Mathis

December 18, 2012

Econ201

Article Response

            Farmers prepare for the Data Harvest. Jeff Hodel, a farmer in Illinois, drives a tractor equipped with devices that can monitor and track all sorts of data such as seed variety and spacing. Farmers are getting help from iPads and other gadgets that help them plant seeds in ways that maximize harvests. In January of 2012, it launched a free companion app for Apple Inc.’s iPad. The app shows a map of a crop field and the soil type. At prices near $6 a bushel, every 10-blushed-per-acre increase in the yield on a farm of 2,000 acres would translate to $120,000 in additional revenue.

            The issue affecting this new seed planting is farmers are used to the old tractors and the old electronics and I believe some people won’t want to change the way they’ve been doing things for years. The new electronic might be over whelming to people and it could cause problems. The plus towards the new harvesting is that more crops can be harvest all at once, also known as a surplus.  Also there would be more money going towards the farmers and it would be an increase not only to the Apple’s Inc. but also an increase in farming. Technology is changing the way things are and creating a better future for us. There’s a positive and a negative situation with this new harvesting.

Hannah-Mae Boyd

Article Response

The article “Woes Hit Top U.S. Refinery” written June 14^th, 2012, has to do with the oil refineries slowed down and oil not being produced as much as it should be. The oil companies are losing oil barrels because one million dollars is being lost in revenue every day because of the victims of a mechanical failure. With oil facilities being slowed down for a couple of month’s gas prices will go up. The supply for oil would go down. The oil shortage would be almost 300,000 barrels of oil. The demand for oil would still be the same though. The demand would remain the same because of how much gas you need to use to get back and forth from work or any other place you need to get. If the gasoline prices don’t go back down a lot peoples checks would be mostly dedicated to gas. This is because you cannot just stop getting gas. If you have somewhere to be you are going to need gas to get you there. Gasoline is a necessity and everyone needs it. Having a shortage of oil causing gasoline to go up is not a very good thing. 

                                                                Nina Buccilli

12/18/12

                “The new rule on ‘gainful employment’ exempts nonprofit schools.”  In July 2012, new regulations were put into play on student loans.  Federal Aid was cut off to the students in career and technical colleges.  Education programs will also be cut off from the government if there students don’t meet one out of three thresholds for three out of four years.  They must have at least a 35% loan repayment rate, 30% debt-to-discretionary-income ratio, or 12% debt-to-annual earnings ratio.  These colleges are Economic Institutions and the government is screwing around with them.  The Obama Administration says that for-profits present a bigger risk.  The purpose of the regulations is to protect taxpayers.  That the career and technical colleges are “high risk”, because they will accept students who are poor, racial minorities, single parents and first-generation students.   Yet, the White House gave out billions to its for-profit friends in the green lobby.   Obama also says that every-one in America should ‘play by the same rules.’ Yet these regulations are only for career and technical colleges? The writer says that Obama should level the regulatory field between career colleges and nonprofits and turn off the taxpayer spigot. I think that if Obama is going to raise regulations on some colleges he needs to do it on all of the colleges. There needs to be an Equilibrium Price. If the minorities are not able to get a quality education then the gap between the wealthy and the poor will grow bigger.  Consumers will not buy anything if there is nobody running the producers.  The world is a Competitive Market and if nobody gets an education they cannot compete.   If there were no regulations money would be lost and people in great amount of debt that they can’t pay.  “High Risk” students are high risk and it’s a gamble.

Article Response

In my article it is about insurers standing firm on the benefits they allow for all households. This article talks about how the insurence companies of Humana, Aetna, and UnitedHealth allow young people to stay on thier parents' plans until the age of 26. With this being a part of thier plans, about 2.5 million young adults gained coverage. Since they gained coverage, a forcast of the number of young adults not being on coverage and not being able to afford it has changed drasticly. It is estimated that before the young adults of the ages between 19 and 26 were able to be under their parents coverage, around to 6.6 million of them were not eligible to get coverage on their own. This federal law has helped many Americans by getting the coverage that they need with this marginal benefit. This change in that these insurance companies have made them better firms and have caused an increase in this model and has been a better decision that America has made for the American's.

Article Review 

            Studies found that the leading insulin doesn’t heighten cancer risk then the amount of treatments would increase, the amount of deaths would increase.  Four studies involving Sanofi SA’s lantus insulin appeared to blunt concerns that is might cause cancer.  This would cause something that would be similar to a Shortage. In A shortage a price will increase, in this situation the amount of people with cancer would increase if the leading insulin contributed to cancer. This then causes the amount of treatments to skyrocket and we would see the amount of people dying by cancer increase. If many people needed more treatment then there would be shortages in medicine and economic forces would take hold causing people to ration all of the medicine used to fight off cancer.

            This will not happen though because the leading research proves the leading insulin does not contribute to cancer. This then means that many people will remain safe and able to get correct treatment with insulin. This would cause more people to keep their lives and then the death toll would remain about the same.

Externality

The Third party in this situation would be the producers of medicine. If the amount of people that had cancer increased then the amount of medicine will increase causing the amount of money that the medicine producers get will also increase. It is not over good circumstances in this situation but this would be a positive externality for the medicine producers. If the amount of people with cancer stayed relatively the same then the amount of medicine needed would not change and the amount of money that the medicine producers need would remain stable and this would neither be a positive or negative externaltiy. 

Article Review

U.S. developers are likely to install about 3,300 megawatts of solar panels this year, nearly doubling the amount installed in 2011. The global solar-power market has been turbulent for manufacturers, as prices have plunged amid an oversupply of panels. The report predicted that global solar-panel installations this year will reach nearly 30 gigawatts, which would make the U.S. the fourth largest solar market, with an 11% share of the global market. If we used more solar panels then the price of heating would go down, causing more efficiency. 

Article Response

Verizon wireless has recently changed their data plans to meet individuals demands. Verizon has changed their plan to unlimited internet to a two gigabit plan. While Verizon changed their plan they also got rid of the cheaper plans that people used to get. This will raise a lot of people’s bills with only one device. Verizon also made shared data plans. Having more devices on data plans will make your overall plan cheaper.  This is an efficient way to get consumers to add more devices onto their plan, because there bill will be close to the same amount with one device as it will be with more than one device.  

There is both a positive and negative externality in Verizon changing their plan. The negative externality is that people with just a single device will have to pay more money for their plan, so the consumer with only a single devises plan will go up. The positive externality is that if you have multiple devices on you plan Verizon’s change will benefit you. If you have more devices on your plan is that if you have multiple devices you will end up paying less money for each individual devices.

Jesse Conlay – Externalities

            The externality in the article about corn crops in the Midwest being affected by dry weather and above-normal temperatures is that any livestock farms that feed their animals corn-based feeds would be affected. If the supply of corn goes down, price goes up; therefore the price of the corn feed will go up. The cost of producing the goods from the livestock will go up, which will in turn cost consumers of livestock products more, even though they are not purchasing a corn product directly.

For the article I found in the paper it was about how GM firm has went from bankruptcy to not.  Even though they aren’t in bankruptcy anymore the chief executive is still grinding his teeth because they aren’t making as much as they once were.  If they can’t make enough money for that big of company then it might start heading back to bankruptcy again.  Their biggest competitor Toyota Motor Corp. has an absolute advantage.  GM trails Ford in its home turf in both sales growth and profitability, and Ford’s new line of pickup trucks outsells GM’s lineup.  In short GM is making fewer cars which means the prices will go up for the consumers.  Another thing is the fact that they are making cars that nobody wants.  This is a big deal, and if they keep this up then they will go into bankruptcy again.

Rachelle Reihl

Externality-Article Response

There would be a negative externality, because you would still be making the same amount of income but inflation is still increasing. This would mean that your money tomorrow will really cost less than it does today.

Caron White

The switching of money to peso from dollars is a negative externality because the acual amount to money that a person has will decrease.  Inflation will continue to rise while a persons income will stay the same causing families to lose a majority of their money.  Argentina's inflation will stay at a high and could increase even more with the switching of the money.

Article Response

          We all know that everyone has a choice on what product to buy, therefore all the companies and businesses are trying to get them to choose their product.  A good example of this is google chrome.  In class we debate on whether we should use internet explorer or google chrome and lately google has been stepping up their game to beat out the competition and they are increasing demand.  When the demand increases then the demand curve is shifted up.  The google company keeps redesigning the product and making improvements.   Yet the factors of production stay the same for all these internet browsers. 

Hannah-Mae 

Externality Article Response

                The article I had was about the oil refineries being slowed down and producing less oil. Which means gas prices go up. There would be a negative externality with oil being produced less. This is because the production of oil went down so immediately gas prices go up and affects everyone. Oil being produced less will have a major negative externality on everyone. There would be no positive externality at all. 

               The Ford Motor company has recently recalled their Escape SUV and Fusion midsize sedan due to an overheating issue with its EcoBoost Engine. This will make the demand for these vehicles go down because no one wants to buy the faulted cars. And the supply curve shifts right because there will be a higher supply of cars. Currently the sales of Ford have not been affected too drastically; the Ford Motor Company’s stocks have only gone down about 0.3 percent so far. This will cause an increase in sales of other competing motor companies since the public will not want to buy a recalled vehicle. If Ford solves the overheating issue in their SUV’s and sedans then the demand curve will move up and go back to its original figure before the recall. I forecast that if the engine problem is not fixed soon then the company can eventually see drops in sales and a loss of profit.

                The overall reaction from the public is a negative outlook on Ford. Less people will be buying from the company and spending money on vehicles. This in the long run will have Ford lose money from recalled cars and make the company very unhappy.  

Weekly Learning Discussion

SEEKING A WIZARD: TIME TO EMBRACE MARKET RISK, OR TO RUN FROM IT?

This article ties into ECON201 due to the markets.   Have you ever thought of that stock markets as trains?  If you haven’t it works like this, some people would like to take the slow train and bolt the doors shut as in they would like to wait out the market then take the next step.  On the other hand there are people who would want to pry the doors open to the faster, expressed train and take that extra step.  Those people choose to take that step or not by the market’s reaction on Monday either by enthusiasm or with concern to the Spanish bank bailout.  You have limited options unless you are an oil-loving buff with a penchant for noon-euro currencies.