Discuss the supply and demand model, the factors that affect prices, and how prices will ration scarce goods and services.

 

Note: The online classroom is designed to time students out after 90 minutes of inactivity. Because of this, we strongly suggest that you compose your work in a word processing program and copy and paste it into the discussion post when you are ready to submit it.
Learning Outcomes

This week students will:
Describe the role of economic theory in economics.
Analyze the mechanics of the circular flow model.
Explain how supply and demand interact to determine market equilibrium.
Introduction
Week One focuses on the foundation of economics. This week, we will learn that economics is the study of resources allocation in a given society to satisfy wants and needs of the people. We will also discover how unlimited wants with limited resources forces us to make choices.

The four factors of production include: labor, land, capital, and entrepreneurial ability. Key questions in economics are: What do we produce? Who do we produce it for?  How and where do we produce the goods and services?

This first week will discuss the supply and demand model, the factors that affect prices, and how prices will ration scarce goods and services. Economists use theories and models to make decisions and to explain economic ideas and concepts.

Required Resources

Required Text
Read the following chapters from Microeconomics Principles and Policies:
Chapter 1: Economics, Economic Methods, and Economic Policy
Chapter 2: Markets, Governments, and Nations: The Organization of Economic Activity
Chapter 3: Supply and Demand: The Basics of Economic Analysis

Recommended Resources

Articles
Bishop, J. A., & Yoo, J. H. (1985). “Health scare,” excise taxes and advertising ban in the cigarette demand and supply. Southern Economic Journal, 52(2), 402. Retrieved from the ProQuest database.
Jamieson, A. & Giesecke, L. (2007, November 19). US gasoline supply deficit to more than halve by 2010. Oil & Gas Journal,105, 58-61. Retrieved from the ProQuest database.

Multimedia
Khan Academy (Producer) (n.d.). Law of Demand.  The Demand Curve [Video file].  Retrieved from https://www.khanacademy.org/science/microeconomics/supply-demand-equilibrium/demand-curve-tutorial/v/law-of-demand. To view with subtitles, under the video window click on “Options” and check “Translated subtitles” in the drop down.
Khan Academy (Producer). (n.d.). Law of Supply. The Supply Curve [Video file]. Retrieved from https://www.khanacademy.org/science/microeconomics/supply-demand-equilibrium/supply-curve-tutorial/v/law-of-supplyTo view with subtitles, under the video window click on “Options” and check “Translated subtitles” in the drop down.

Post Your Introduction
To post your introduction, go to this week’s Post Your Introduction link in the left navigation.
Post your introduction on the first day of class in the  discussion forum titled, “Post Your Introduction.”.  Respond to at least three of your classmates’ posts  In your introduction, please address how this economics course relates to your current or future career.

Discussions
To participate in the following discussions, go to this week’s Discussion link in the left navigation.
Circular Flow Diagram

Explain how the circular flow diagram relates to the current economic situation. Using the circular flow diagram, explain a way that your family interacts in the factor market and a way that it interacts in the products market.

Guided Response:
Review the discussion board posts of your classmates. Respond to at least two of your classmates and comment on their descriptions of the circular flow diagram and factors of production. Discuss how circular flow relates to current economic situations.

Supply and Demand

Analyze how the law of demand applies to a recent purchase that you made. Describe how the product has changed in price and explain whether the price change is due to supply or demand. Did the change in price affect your decision to purchase the item?

Guided Response:
Review the discussion board posts of your classmates. Note their analysis of a recent purchase and respond to at least two of your classmates. In your responses, discuss the effects of a price change and how it might alter your decision to make a purchase, according to the determinants of supply or demand.

Quiz

To complete the following quiz, go to this week’s Quiz link in the left navigation.
Week One Quiz

This quiz consists of 10 questions. The amount of time the quiz will take to complete will vary by individual.

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