1. Consider all of the readings, assignments, and quizzes you have completed during the course. Describe how business professionals can use economics and statistics to improve decision-making and long

Discussion 1

1. Review Chapter 1 in Economics for Today.

2. Respond to the following prompts:

   • Explain the difference between macroeconomics and microeconomics. Give examples of the areas of concern for each branch of economics.

   • How are macro and microeconomics interrelated? 

My post

Firstly economics is the sub-division of knowledge or social science that seeks to address production, consumption, and wealth transfer. Therefore economics concept is based on how a community or society utilizes its limited resources.

The difference

Microeconomics is the study of how businesses and people develop decisions related to the prices of which services and goods will be sold and resource allocation. It also considers governmental legislation, regulations, and taxation. Therefore it mainly focuses on demand, supply, and other pricing determining factors in an economy. However, it does not seek to explain the market forces but what occurs when certain conditions are implemented. An example of microeconomics is when a bread-producing company decided to increase its production capacity, lowering the price per unit.

While macroeconomics seeks to study a county's overall behavior and how a country's policies affect the entire economy, macroeconomics seeks to examine the economies and industries rather than people and companies like the microeconomics concept. Therefore it is also called a top-down method since it seeks to understand the stimulants of economic growth. An example of macroeconomics is when a company increases its export levels, increasing the GDP's "gross domestic product." Martins et al. (2017).

The relationship.

Despite the clear difference between the two, the relationship between the Microeconomics and macroeconomics concepts is that the aggregate production and consumption levels mainly result from individual companies and household consumption. Therefore the changes in macroeconomics show the changes in behavior in microeconomics. And example, when there is increased inflation or changes in the exchange rate, the overall production of goods process is affected. Therefore inflation increases the process of raw material, which also increases the company's overall costs. Syverson (2019).

References

Martins, N. M., Pires-Alves, C. C., Modenesi, A. D. M., & Leite, K. V. B. D. S. (2017). The transmission mechanism of monetary policy: Microeconomic aspects of macroeconomic issues. Journal of Post Keynesian Economics, 40(3), 300-326. https://www.tandfonline.com/doi/abs/10.1080/01603477.2017.1319249?casa_token=0HkbN6J8Tz0AAAAA:5bb33DBSFesZ6aEcTGzJ_SIwrR-1GFOnqttx1HvZ_3b0pevobJQr5UdZF2oxY2R4AMAZfJQc_8j1epQ3qg (Links to an external site.)

Syverson, C. (2019). Macroeconomics and market power: Context, implications, and open questions. Journal of Economic Perspectives, 33(3), 23-43. https://www.aeaweb.org/articles?id=10.1257/jep.33.3.23

Teacher feedback

Ashleigh - Microeconomics deals with individual and business decisions whereas Macroeconomics deals with economics as a whole. Economics is omnipresent in our lives. In other words, microeconomics view the economy in segments whereas macroeconomics have a whole aggregate view of the economy. The following link provides you more details regarding the difference between micro and macro economics. https://www.economicshelp.org/blog/6796/economics/difference-between-microeconomics-and-macroeconomics/

Discussion 2

1. Review chapter 3 in Economics for Today.

2. Read the case The Market Approach to Organ Shortages on page 80 in Economics for Today.

3. Draw supply and demand curves for the U.S. Organ market and compare the U.S. market to the market in a country where selling organs is legal. 

4. Respond to the following questions:

   • What are some arguments against using the price system to allocate organs?

   • Should foreigners have the right to buy U.S. organs and U.S. citizens have the right to buy foreign organs? Explain your answer in terms of economics.

5. Study the following Biblical verses that deal with a Biblical view of wealth: Luke 16:10-11, I Timothy 5:8, and Deuteronomy 8:18, and respond to the following prompts:

   • What is wealth according to God’s word?

   • What should an individual do with the wealth and prosperity that God has provided?

   • What are the differences between a Christian perspective and a secular perspective on wealth creation and the use of wealth?

My post

The Market Approach to Organ Shortages

           The argument against the price system is the open discrimination that occurs for the financially poor. Therefore, although the decision to give kidneys to some people and deny others is difficult, tying it to financial strength is unethical at every standard. The prices tied to the kidney are used as a form to ration demand. The system also creates a business environment rather than a humanitarian cause leading to quality issues on kidneys and organ supplied and social evils such as kidnappings and murders to get the kidneys (Callais and Block, 2017). Therefore, it is difficult to regulate the market as other factors such as age, gender, social class, and race might influence the prices of organs leading to more divisions. The price system does not meet the demands of the thousands of patients on the waiting list; thus, it is already a failure.
            Foreigners should not have the right to buy organs from the United States, nor should United States citizens buy from foreigners as it creates “transplant tourism” that will take advantage of the poorer countries. The compensation offered for donation will attract many donors, leading to an increased supply than the demand (Hawley et al., 2018). As a result, the number of eligible donors will increase, and at the same time, the transplant outcomes will improve. Although the costs of transplanting will reduce, it will earn countries foreign exchange and ensure an economic incentive is obtained from saving lives. If there are monetary incentives to promote “transplant tourism,” then the funds will improve infrastructure and other areas in life. In addition, improved technology utilization will improve the general quality of healthcare.

Bible View on Wealth
            According to Luke 16:10-11, wealth, either little or large, need to get well-managed. A true manager will not despise little wealth and not take care of it. On the other hand, if a manager is waiting for a huge wealth to be responsible and careful, they cannot be trusted. God will not reveal to them the true riches that he has kept for his people. Therefore, we must demonstrate responsibility in all activities and all that Gog has blessed us with before he can reveal heavenly riches. We should demonstrate leadership, reliability, and proper time management in either small positions or big positions for true knowledge on wealth to get revealed to us.
            According to I Timothy 5:8, those who believe in God should demonstrate love and care by sharing their wealth and providing for their families in need. If an individual is enjoying his/her wealth and their household is perishing in poverty, then they are not true believers although they claim to be. Worldly wealth should be shared and enjoyed for God to allow us to enjoy the heavenly treasures he has stored for us. God wants us to be responsible for our families and loved ones just as he loves us and cares for us. It is a demonstration of love that mirrors God’s love.
            According to Deuteronomy 8:18, God has given us the strength of looking for wealth; therefore, we should always be thankful and appreciate his love for us. The health and peace to gather wealth comes from God. According to the secular perspective, the wealth and riches they obtain come from their hard work and dedication, and God does not have anything to do with it. Therefore, the rich should not continue growing rich from their hard work while the poor continue to perish. Since the rich have acquired their wealth by their means, they should not get told how to share or utilize it.

References

Callais, J., & Block, W. E. (2017). Medical Economics: Legalize Organ Markets. The Winners, 18(2), 73-81.

Hawley, Z., Li, D., Schnier, K., & Turgeon, N. (2018). Can we increase organ donation by reducing the disincentives? An experimental analysis. Economics & Human Biology, 29, 128-137.

Holy Bible, New Revised Standard Version (1990). New York, NY: HaperCollins.

Teacher feedback

Ash - In this discussion, we had mixed arguments about organ transportation. Though there are both positive and negative sides associated with the pricing system of organs, everyone agrees that timely organ transportation acts as a life saver. The following link discusses the importance of timely organ transportation. https://khn.org/news/how-lifesaving-organs-for-transplant-go-missing-in-transit/ In addition, we thoroughly reviewed what wealth is from a Christianity perspective. Wealth is not about accumulating or saving, we need to glorify God with what we have. Some ways by which we can glorify God through money is that, - Living a debt free life. As said in Proverbs 22:7, "The rich rules over the poor, and the borrower is the slave of the lender.", by staying debt free we are relieved from the slavery. - Saving money for necessary purposes. Proverbs 13:11 says that a person who saves wealth little by little will increase it. - Develop the habit of giving. Many Christians believe that giving 10% of their income to God is a way to thank him and help others.

Discussion 1

1. Read Beyond GDP: It’s time for the national accounts to put people first. (Links to an external site.) 

2. Respond to the following questions:

   • Why does Stiglitz believe that measuring a nation’s well-being should go beyond GDP?

   • What specific policies and societal norms highlight our nation’s emphasis on the factors of production and/or consumption?

   • What steps can be taken at the local and national levels to put greater emphasis on outcomes, like health, education, and the environment?

   • What does scripture have to say about this topic? Find at least one biblical verse to support your comments.

My Post

Stiglitz understands that when evaluating the GDP, a nation always focuses on its material well-being which is not enough to monitor the performance. According to the article, the GDP should evaluate other essential components like production, environment, and educations. These measurement methods have made us distorted, therefore making us more materialistic like the measuring methods. Additionally, different areas have experienced deficits such as inequality and poor sustainability due to the inadequate GDP metrics in the globe.

The specific societal norm that highlights the emphasis on the production factors is pension reforms that force the individuals to bear a  higher risk of the labor market reforms while leveraging on boosting flexibility and weakening the worker’s bargaining positions. Therefore more insecurity has been created where employers can quickly fire old employees and hire those requiring lower wages. However, better metrics would weigh the costs and compare them with the benefits. This will compel the policymakers to make changes that improve job security and equality. Stiglitz & Boadway (1997).

Several steps can be implemented to promote education, environmental, and health outcomes, including; ensuring that there is social equality where every individual has equal access to schooling facilities, hospitals, and a clean environment. Stiglitz’s essay noted inequality traps where people are likely to remain there due to inadequate access when people are born poor. The second initiative is ‘putting the people’ first which involves understanding what matters a lot to the people and how to improve their well-being. Employers and governments should not just focus on enhancing GDP and revenues through salary cuts and poor employee treatment. The economy should also focus more on health than the GDP, which will improve life expectancy, especially those within the unindustrialized areas.

According to proverbs, 22:2 “Rich and poor have this in common: The LORD is the Maker of them all.” And according to psalms 67:4, “May the nations be glad and sing for joy, for you rule the peoples with equity and guide the nations of the earth.” The bible encourages us to respect one another and treat others equally. Therefore the government should ensure equality in the society where people have an equal chance for self-development and growth in the community where the poor children should not be allowed to enrich themselves. Stiglitz (2013).

References

Stiglitz, J. E., & Boadway, R. W. (1997). Principles of microeconomics and the Canadian economy. WW Norton. https://kewd.pw/wib_vy_bot.pdf (Links to an external site.)

Stiglitz, J. E. (2013). Student debt and the crushing of the American dream. The New York Times, 12.

Teacher feedback

Ashleigh - As you can see, Nominal GDP can change because of either quantity changes or price changes. When there is inflation, nominal GDP overstates the increase in total production. The Bureau of Economic Analysis separates price changes from quantity changes by calculating real GDP Economists use gross domestic product to measure total production. Gross domestic product (GDP) is the market value of all final goods and services produced in a country during a period of time, typically one year. In the United States, the Bureau of Economic Analysis (BEA) compiles data used to compute GDP. GDP measures the value of final goods and services produced in a country during a period of time and the level of income in the country during that same period. Although production of goods and services is not the only factor that determines the quality of life of people in a country, we would normally expect that when a country produces few goods and services, the quality of life in the country will be less than when it produces more goods and services.

Discussion 4

1. Review Chapters 18 and 19 in Economics for Today.

2. Respond to the following prompts:

   • Define aggregate demand and expenditures in your own words. 

   • How are aggregate demand and aggregate expenditures related?

My post

Define aggregate demand and expenditures

For the firms they can adjust the target rates for utilization in the response to previous experience they have had (Dutt,2010). Through this they are able to determine their aggregate demand through accepting ranges of the utilization rate as being normal(Lavoie, 2010). For aggregate demand this is the total demand for the final products as well as services in economy during a particular timeframe as well as prices. This shows amount of the goods as well as services which are going to be bought at possible prices. As the aggregate demand surges the graph shift to the right and when it decreases the graph shifts to left that is an indication of a fall in the output and price.

The aggregate expenditures are current values for all finished products as well as services in an economy. This is the sum of all expenses which are assumed in an economy by factors during the precise phase. This is represented by following equation AE=C+I+G+NX.

This is aggregate expenditures which is equal to total of all households’ consumption(C), investment (I), the government’s expenditures (G) together with the net export (NX ).

Consumption C: households’ intake over given period.

Investments I: is amount of the expenses on capital products.

Government expenditures G: amount of the spending by the federal states, as well as the local governments. Government expenditure comprises of infrastructure or transfer that increasing total expenditures in an economy.

Net export NX: Are total exportations minus total importations.

The aggregate expenditures determine entire amounts which a firm as well as households plans to spend them on products as well as service at every level of the income.

How are aggregate demand and aggregate expenditures related?

The aggregate expenditures as well as the aggregate demands are the macroeconomic perceptions which estimate the two alternatives that have got same values that is national income. Sub specialties deemed general income accounting, market values of all the products as well as services is sum for estimating the gross national incomes, aggregate wealth that is produced by a country. Both the aggregate expenditures as well as aggregate demand takes the consumption, investments, the outlay of the government as well as the net factors of the income from the abroad as the basic component of the economic demands. When the economy is in the equilibrium, the level of expenditure on the consumption, the investments, government outlay as well as the net factor for income from the abroad equating to the total effective demand thus the value for all the goods as well as services which are supplied by the economy.

 References

Dutt, A. (2010): Reconciling the growth of aggregate demand and aggregate supply, in M. Satterfield ed., Handbook of Alternative Theories of Economic Growth, Northampton, MA USA: Edward Elgar, 220-240

Lavoie, M. (2010): Surveying short-run and long-run stability issues with the Kelekian model of growth, in M. Satterfield ed., Handbook of Alternative Theories of Economic Growth, Northampton, MA USA: Edward Elgar, 132-156

Teacher feedback

Ashleigh - The aggregate demand curve shows the relationship between the price level and the quantity of real GDP demanded by households, firms, and the government. The short-run aggregate supply curve shows the relationship in the short run between the price level and the quantity of real GDP supplied by firms, and the long-run aggregate supply curve shows the relationship in the long run between the price level and the quantity of real GDP supplied by firms. The variables that cause the aggregate demand curve to shift are interest rates, government purchases, personal income taxes and business taxes, household expectations of future incomes, firms’ expectations of the future profitability of investment spending, the growth rate of domestic GDP relative to the growth rate of foreign GDP, and the exchange rate between the dollar and foreign currencies.

Discussion 5

1. Read A Refresher on Statistical Significance (Links to an external site.) by Gallo (2016) and read James 1:5, Proverbs 9:9–10, and Matthew 22:39. 

2. Respond to the following questions:

   • Why do economists and statisticians use samples to draw inferences from data?

   • What roles do variation and sampling error play in determining statistical significance?

   • Provide an example how how these concepts can be applied in the real world.

   • How could or should the biblical passages alter our worldview as students of business?

My post

Why do economists and statisticians use samples to draw inferences from data?

The statistical inferences from a sample (smaller population) are essential in making predictions, estimations, and judgments related to a larger group by analyzing and examining information from a smaller group that represents the larger one. There are significant reasons why economics used smaller samples include; firstly, using the entire population for data collection would be expensive and unachievable. For example, when one seeks to know the effects of covid19 on stock markets return-on-stock figures, it's impossible to collect data and information regarding all the stock markets globally due to cost, time limitations, and bulkiness of the stock markets data. Therefore, it would add no value when considering the research's cost-benefit approaches compared to the overall findings. Gallo (2016).

What roles do variation and sampling error play in determining statistical significance?

The variations are essential when an economist researcher seeks to understand whether the sampling techniques are efficient or not. For example, where the variation is led, the accuracy of the sampling method will be relatively low and vice versa. Therefore when the sampling approach used has fewer errors, the results and findings of the study will also have fewer errors. The variation is applied to check for the largest and smallest sample errors because the sampling error often arises when the sample does not match the entire population's needs. Gallo (2016).

Provide an example how how these concepts can be applied in the real world.

 An example of how these concepts would be applied in the real world is when a company develops a new product and seeks to check for the best price based on the market factors and costs of production. The company will hire an analyst to look for the statistical significance to understand how their finding will affect the overall product's price.

How could or should the biblical passages alter our worldview as students of business?

According to James 1:5, we understand that if we lank wisdom or alternative ways to solve problems we are exposed to in our lives, we should always ask for God's help since he is ready and generous when giving. When doing economic research, we will often face challenges; however, believing and trusting in God's guidance, we can overcome the obstacles.

References

Gallo, A. (2016). A Refresher on Statistical Significance. Harvard Business Review.

Teacher feedback

Ashleigh - Inferences are drawn to procure relevant results from the collected data. However, variations are chipped in, so that the difference in the behavior can be noted to cluster the various sets of data. Sampling error is that value which is obtained causing a difference in the data of the drawn sample set, when analogized with the population as a whole. Variation and sampling are crucial for analysis due to the significant indagation it delivers in relevance to the fundamental structural data behavior.

Discussion 6

1. Read Case Problem 2 on pages 452-53 in Modern Business Statistics.

2. Respond to the following:

   • Summarize the data from the case and comment on your findings

   • Develop 95% confidence intervals for the proportion of all students, the proportion of male students, and the proportion of female students who were involved in some type of cheating. Explain these findings.

My post

Summarize the data from the case

• All students

• Male Students

• Female Students

Comments:

• Male students (43. 75%) cheated more on exams compared to female students (38.10%)

• The percentage of female students who copied directly from the internet was more than male students that copied from the internet.

2. Develop 95% confidence intervals for the proportion of all students, the proportion of male students, and the proportion of female students who were involved in some type of cheating. Explain these findings.

Female Students

P = 38.10%

Margin of Error = 1.96 * √ {(38.10 * (1 – 38.10)) / 90}

Margin of Error = 14.69%

Therefore,

95% Confidence Interval = 38.10 ± 14.69

                                        = 23.41% or 52.79%

Comment:

• I am 95% confident that the percentage of female students that participated in some form of cheating lies between 23.41% to 52.79%

Male Students

P = 43.75%

Margin of Error = 1.96 * √ {(43.75* (1 – 43.75)) / 90}

Margin of Error = 14.03%

Therefore,

95% Confidence Interval = 43.75± 14.03

                                        = 29.72% to 57.78%

Comment:

I am 95% confident that the percentage of male students that participated in some form of cheating lies between 29.72% to 57.78%

All Students

Margin of Error = Z * √ {(p * (1 – p)) / n}

P = 41.11%

Margin of Error = 1.96 * √ {(41.11 * (1 – 41.11)) / 90}

Margin of Error = 10.17%

Therefore,

95% Confidence Interval = 41.11 ± 10.17

                                         = 30.94% or 51.28%  

Comment:

I am 95% confident that the percentage of students that participated in some form of cheating lies between 30.94% and 51.28% 

Teacher feedback

Ashleigh - When a survey is conducted, or a poll is reported, the confidence level is also a part of this report. It is represented in terms of percentage. It refers to how much certainty or uncertainty is associated with the survey results based on a sampling method. Please take the time to review the following video which explains about the "Confidence Intervals" https://youtu.be/w3tM-PMThXk