Notes, abstracts, papers, exams and problems of Economy

Assignment 5

Macroindicators

Goods and services – GDP, Labor – Unemployment, Capital – Inflation.

Mercantilism

Based on the principle that the world's wealth was static, nations attempted to accumulate the largest possible share of that wealth by maximizing their exports and by limiting their imports via tariffs.

WTO

International institution that oversees global trade rules among nations.

HeckscherOhlin Model

Evaluates the equilibrium of trade between two countries with varying specialties and natural resources.

Leontief Paradox

Capital-abundant countries export labor-intensive goods and labor-abundant countries export capital-intensive goods.

GDP

Monetary value of all finished goods and services made within a country during a specific period.

Inflation

Rate... Continue reading "Understanding Global Economics: Trade, Currency, and Development" »

DEFINING COMPETITION

Definition

The set of actions that undertakings (companies) take to obtain the preference of consumers, these actions include rivalry among companies and are only feasible because there are conditions that facilitate open and participative markets.  COFECE

Competition is a multidisciplinary field that includes elements from areas of knowledge such as:

1. Law

2. Economics

3. Political

4. Science

5. History

History of Competition in Mexico

We have had competition law in the country since 1993, as well as agencies, and these were strengthened as part of the economic reforms of 2013.

1. 1824 CPEUM.- The need for free market access and competition is foreseen

2. 1993.- Competition policy exist since 1993. (Competition law, as agencies)

3. 2013.- Economic reforms

4. 2014.

Fiscal Contract

= C+Output baj IS no camb cdo baja i Islm, baja Ms= sube i+no inicial en Y I spending dpnd en i. aument G=baja I Cambios Ms no afect price level short run LM comb i+Y mantien eq n financ mrk. Reduct consumr confidnc=left shift is curv I spending dpnd output= baja i Aggregate supply relation, current Plevel dpnd expectd pric level Fixed IS curve: baj i sube I CB=opn mkt purchase bonds=lm abajo Real supply=stock € medid n bns,no $ ISLM,baja G, baja gradual i+Y AS: baj output,baja unemployment,baja nominl wage,baja P. I no dpnd i =baja Ms no camb output CB compr bons y aument T y baja i Xpansionry: sube Pbons baja i Aument (c), ppcion € persns quiern en moned baja money multiplier Contract: bajn bons,sub i CB open market sale... Continue reading "Understanding Fiscal Contracts and Economic Impact" »

Defining The Problem:

1st step is defining the problem. Problem Definition involves discussion with decision makers, interviews with experts, analysis of secondary data. Once defined, research can be designed and conducted properly.

Developing an Approach to the Problem:

Formulating an Objective or Theoretical Framework, analytical models, research questions, and Hypotheses, and identifying the information needed.

Research Design Formulation:

The Blueprint for conducting the market research project, which details the procedures necessary to obtain required information. The purpose is to design a study that will test the hypotheses, determine possible answers to the research questions, and provide information needed for decision making. Addressing... Continue reading "Market Research Process and Errors: A Comprehensive Guide" »

Question #2: Four Ps are the part of marketing Mix concept and they help marketers to make marketing strategy related to product, price, place and promotion to its market segment. Lets understand what Is marketing mix -

Marketing Mix combination of 4 Ps: Product Is something tangible offered to customers in market segment. For example- Iphones are product offered to customer segment having high income, Professionals and Job doers.

Price Is the second factor which tells us about the actual value of product and how Customers in market segment are willing to pay for the product. For Example- Iphone is offered to low or middle class people then they Would hesitate to purchase but if it is offered to high class people like Business man, doctors,

• Elements: (installation, delivery, warranty, after sales) - (packaging, features, styling, quality, brand name) - (core benefit or service)
• Alternatives: selling as an international marketplace, modify for countries, design new products, global product
• Standardization: selling the same product worldwide
• Stan: scale production, product R&D, economize in marketing
• Adaptation: differing use conditions, government influences, consumer behavior, local competition, marketing concept
• Stan: universal brand, industrial goods, technology intensive
• Adaptation: regional characteristics, product, company considerations
• Tariff: trade barriers that restrict imports and exports through mechanisms other than the simple tariff, protect domestic
• Advantage: protectionism

1. Real GDP per Person

Define real GDP per person. At what rate did the U.S. real GDP per person grow from 1914-2014? –Real GDP per person is real GDP divided by the population. Real GDP per person tells us the value of goods and services that the average person can enjoy. Real GDP per person in the U.S. doubled between 1960 and 1987 and almost tripled between 1960 and 2013.

2. Factors Affecting Potential GDP

What are the two factors that make potential GDP grow? –Potential GDP, which is the maximum level of real GDP that can be produced while avoiding shortages of labor, capital, land, and entrepreneurial ability that would bring rising inflation and fluctuations of real GDP.

3. Classical Growth Theory

What is classical growth theory? –A

Ricardian Model

Unit Labour Req.  Pears(Ib).  Oranges(Ib)

Home                  4h (aLp).         3h (aLo)

Foreign.              6h (aLp*).        1h (alp*)

Absolute Advantage - country takes less time to produce goods?

Home -> pears // Foreign -> oranges

Comparative Advantage - lower opportunity cost 

- Home has a C.Adv in pears production as its opp. cost of pears production is lower than foreign country - will specialize in pears

PPF (grafico) - (aLp · Qp) + (aLo · Qo) <= L

4Qp + 3Qo <= L (Qp = 300 & Qo=400)

Maximum home pears production is 300 and oranges 400

Slope = opp. cost - the opp. cost of pear is how many pounds of oranges Home must stop producing in order to make one more pound of pear

Absence of