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Provide an example where you may be using economics as a tool for making decisions and classify your example as dealing with microeconomics topics or macroeconomic topics.

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Darryn D'Souza
Darryn D'SouzaLv10
28 Sep 2019
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Principles of Economics
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Related questions

probably economist uses both quantitative and qualitative data to justify their decisions. Modern economics, neoclassical economics in particular, often relies on probability. a 

1) Provide 3 reasons why you think that probability should always or should not always be used when making economic decisions or forecasting?

2) Do you think there are some instances where economic changes are based on sheer luck? Please provide 3 examples to justify your conclusions.

3) In general sense, can probability always be a reliable source for business decision-making? Why? Please provide 3 reasons.

***Please Show steps so I can understand the Material***

a) What do you want to write your policy brief on? Describe in a few sentences the problem that the policy solves, or describe the current policy. Note that because only one student can do each policy/topic, you may be asked to change your topic slightly. You can email me and “claim” your topic if you want; topics will then be awarded first-come, first-serve.

b) Does this policy already exist in any population, group, or country? If so, where?

c) Define the target population of the policy. For example, does your policy target children, low-income households, minorities, or college students? Or is it for all Americans? Or citizens of another country?




MAKING PRODUCTION DECISIONS

U.S. wars in Iraq and Afghanistan, political unrest in South America, growing U.S. antipathy in Iran, and civil wars in Africa have driven crude oil prices up several times in the last several years. Although oil prices fell significantly in 2011, they are expected to rise again as the world economy recovers. Adding to the uncertainty, it is predicted that natural gas prices, which fell in concert with significant new gas field discoveries, will rise as more and more utilities switch from using coal or oil to natural gas.

Suppose you are the manager of a public utility that supplies electricity to a significant portion of your geographic region. You preside over electrical generation facilities that can produce electricity using either natural gas or oil or some combination of both.

In the past several years, you have been faced with skyrocketing, then plummeting, natural gas prices, and now think you face the possibility of more of the same, coupled with the probability of similar volatility in oil prices.

Having been trained in Managerial Economics, you are familiar with production functions, isoquant and isocost analysis, and other tools of microeconomics. How can you use these tools to decide the best path for your company to pursue? What are the pros and cons of using these tools?

Provide specific examples of how to go about making the difficult decisions you must make in the near future as well as an overall blueprint of action.

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