Notes, summaries, assignments, exams, and problems for Economy

… Δ Qd Y1

EY = --------- × ---------

Δ Y Q1

…perfectly (or infinitely) elastic:

the extremely elastic situation of demand or supply where quantity changes by an infinite amount in response to any change in price; horizontal in appearance

perfectly inelastic:

the highly inelastic case of demand in which a percentage change in price, no matter how large, results in zero change in the quantity; thus, the price elasticity of demand is zero; vertical in appearance

(relatively) elastic:

the percentage change in quantity demanded is greater than the percentage change in price; measured price elasticity of demand is greater than one (in absolute value)

(relatively) inelastic:

the percentage change in quantity demanded is less than the percentage... Continue reading "Understanding Elasticity of Demand and Revenue in Economics" »

Incoterms: FAS, FOB, CIP, and CPT

What kind of cargo is used for FAS? Why?

Containers are used for FAS because the goods are carried on board a ship.

Which are the two possible cases of delivery for FCA?

• When the goods have been loaded on the transport designated by the buyer or by a person acting on its behalf.
• When the goods are made available to the seller's carrier transport, without being discharged.

Allocation of Costs and Risk for FAS and FOB

The seller is required to deliver the goods alongside the actual ship on the pier. From that point forward, the buyer bears all costs (loading cost, freight, insurance) and risks. Under FAS terms, the buyer is required to clear the goods for export and pay the cost of loading the goods.

Why is it so important

SOCIAL:

• Population development in the relevant countries (important groups, migration…).
• Social-psychological currents (work mentality, propensity to save, leisure behaviour, automation, relevant materials and products).

TECHNOLOGICAL:

• Production technology (trends in the process technology, innovation, automation…).
• The speed of product innovation.
• Substitution technologies (possible innovations, development of costs).
• Recycling technology.

LEGAL:

• Trends in economic policy (tax, compliance, competition laws).
• Trends in social legislation, labour law.
• Importance, freedom and influence of trade unions.

ECOLOGICAL:

It refers to trends in the protection of environment (environmental awareness, environmental impact and environmental legislation). Availability... Continue reading "Analysis of Social, Technological, Legal, Ecological, and Organizational Trends" »

Reverse Engineering as a Source of Knowledge and New Technology

Working Backwards: Take a product produced by a competitor and devise a method of producing a similar product.

Result: A slightly different product and a slightly different production function.

Profit Theories for Describing Business Performance (e.g., Amazon)

Monopoly Theory of Economic Profits

• Some firms are sheltered from competition by high entry barriers.
• Sources of protection: economies of scale, high capital requirements, patents, monopoly over inputs, government protection (e.g., import prevention).
• Monopoly profits can arise because of luck or happenstance (being in the right industry at the right time).

Innovation Theory of Economic Profits

• Profits arise following successful invention

Company Organization Chart

The business organization chart is headed by the Board of Directors, led by the chairperson or president. Below, we find the director of the company who is responsible for five departments led by senior managers. The company is composed of five main departments.

• The production department is responsible for producing goods efficiently, on time, and in the agreed quantities.
• The marketing department is made up of three units: market research, sales, and advertising/promotions. They find out what customers require and then try to ensure that they can get these goods and services. The sales department is divided into two sections: domestic sales and exports.
• The financial department deals with the money that goes in and out

Facteurs De qualité - Poisson

1. Odeur fraîche et douce

2. Yeux clairs, ronds et brillants

3. Branchies propres et rouges

4. Écailles brillantes et bien Adhérentes

à la peau

5. Chair ferme et élastique

6. Filets brillants, humides et fermes

sans contusions, taches de sang ou Brunissement

 Facteurs de qualité - Fruits de mer

1. Les homards et les crabes vivants Doivent être en mouvement

2. Les crustacés doivent avoir des Coquilles dures

3. Les fruits de mer frais doivent être Expédiés avec des algues humides

4. Les mollusques doivent être fermés Hermétiquement ou se fermer lorsqu'ils sont tapotés

5. Tous les fruits de mer frais doivent Avoir les documents et les étiquettes nécessaires

 Les produits élaborés ou semi-

Understanding Wealth Taxation

A wealth tax is a tax periodically levied on an individuals' net value of assets.

Definition and Scope

These assets, for example, include:

• Bank deposits
• Savings
• Real estate
• Luxury items (art, jewelry, airplanes, etc.)
• Personal trusts

Liabilities like mortgages, loans, or other debt are deducted from a person's wealth.

Global Implementation

Current Adopters

Currently, three countries have a wealth tax implemented in their tax systems:

• Norway
• Spain
• Switzerland

Tax characteristics vary from country to country and sometimes even within a country.

Specific Cases

Belgium recently implemented a form of wealth tax that, unlike in other countries, only includes financial instruments held in an individual's securities accounts.

France abolished... Continue reading "Wealth Taxation Explained" »

Glob:

Refers to the trend towards a more integrated global economic system.

Glob in markets-

The merging of historically distinct and separate national markets into one huge global marketplace. Tastes and preferences of consumers in different nations are converging upon some global norm (Coca Cola, Starbucks, Sony PlayStation, and McDonald’s). However, most globalized markets are industrial goods and materials. Many factors mean that national markets and cultures are still very different and very hard in practice to standardize your product or service globally.

Glob Prod:

The sourcing of goods and services around the globe to take advantage of national differences in the cost and quality of factors of production. The goal is to lower the overall... Continue reading "Globalization: Trends, Implications, and Challenges" »

MANAGEMENT MODELS

Partial Models: specific elements of the Management process brought to the foreground

• Management by Exception – Management only in exceptional situations.
• Management by Delegation – Management by transfer of tasks.
• Management by Decision Rules – Default decision rules are given.
• Management by Results - Management by control of results.

* Total Models: Inclusion of all elements of the Management process

• Management by Objectives – Management by agreed targets.
• St.Gallener Leadership Model - overall integrating model.
• Harzburger Leadership Model - Management with autonomous employees.
• 7-S-Model - Mc.Kinsey Model - hard and soft factors.

* Management by objectives

-Description

o Management and employees agree jointly on targets.

o Employee... Continue reading "Management Models and Objectives: A Comprehensive Overview" »

Key Supply Concepts

The following terms are fundamental to understanding how supply operates in a market.

Supply Schedule Defined

Supply Schedule: A listing of the various quantities of a particular product that a producer would supply at all possible prices in the market.

Understanding the Supply Curve

Supply Curve: A graph that shows the quantities supplied at each possible price in the market.

The main thing to remember is that all normal supply curves have a positive slope that goes up when you read the diagram from left to right.

Changes in Supply

Change in Supply: A situation where suppliers offer different amounts of a product for sale at all possible prices in the market.

Factors Influencing Supply Changes

• Cost of resources
• Productivity
• Technology
• Taxes
• Subsidies
• Government