Questions: 1, 2, 4, 5, 7, 10, 11, 12, 14, 15, 17, 19 & 20 How is it that unplanned, market economics operate at all?

What aspect of human behavior puts bread and meat on the shelves of groceries? o Unplanned market economies work because many people perform decentralized activities based on mutual benefit, and coordinated by price. Competition, because of scarcity, is what drives people to prefer more goods for themselves

It is apparent that most of the time, goods are not wanted, or thrown away because no one wants to buy them. How is it that approximately the correct amounts of goods get produced in each market, and what mechanisms are there for correcting erroneous decisions about production levels? If a seller cannot sell all of their goods, they will lower the price so that the demand increases and all of the goods will be sold. If a seller does not make enough of a good, they will raise prices so that the demand decreases, avoiding excess demand

Is scientific the same thing as true? o No. Scientific statements are positive statements and can be true or false.

What is it that makes some proposition scientifically interesting and useful? o Propositions that could be wrong but are confirmed by the facts. Can propositions be good in theory but lousy in practice? o No, because by definition a good theory is good in practice. People of the Pacific Northwest consume more water per person than people in the southwest. Does this mean the North westerners like water more, or are in general thirstier than South westerners? o In the NW, water is more plentiful, and therefore cheaper. In the SW, water is scarcer and therefore more expensive. According to the law of demand, at lower prices people consume more.

Distinguish scarce and limited (they are not the same). o Scarce means not enough of a certain desireable good while limited means not enough of a certain good. If only people learned to love other people more and to respect differences of opinions, we wouldnt have to live in such a competitive, unpleasant world Do you agree? What is the fundamental reason why competition for goods exists? o The fundamental reason for competition is scarcity, not a lack of love or respect. Even if all people were angelic, distribution of goods would have some competition due to scarcity. What is the cost to you of going to college? Is it just tuition, or is there something else involved? o Housing, food, and books. In some countries, a test that determines the sex of a fetus (amniocentesis) is being used to abort female fetuses. As a result, 60% or more of the babies born in some of these areas are male. What do you suppose will be the long-term effects of this on traditional gender and marriage roles? o The supply of women decreased, so this would cause the value of women as wives and mothers to increase. This reinforces traditional marriage roles. Can a good be scarce for some people and not for others? If you think so give some examples. o Yes, when demand is influenced by preferences. What does free enterprise mean? Does it mean we are free to do anything we want? o Free enterprise is where individuals can own resources and use those resources how they choose, but these choices are constrained by laws. Some define economics as the study of proposition, theres no such thing as a free lunch. Is this a good definition? o No, economics is the study of how people respond to changes in the constraints that scarcity imposes.