Critical Analysis Questions Chapters 1
Answer and submit using APA format for
each of the following Critical Analysis Questions:
3. a. What method is used to ration
goods in a market economy? How does this rationing method influence the
incentive of individuals to supply goods, services, and resources to others?
b. How are grades rationed in your
economics class? How does this rationing method infl uence student
behavior? Suppose the highest grades were rationed to those
whom the teacher liked best. How would this method of rationing influence
7. A restaurant offers an “all you
can eat” lunch buffet for $10. Shawn has already eaten three servings, and is
trying to decide whether to go back for a fourth. Describe how Shawn can use
marginal analysis to make his decision.
6. If you have a private-ownership
right to something, what does this mean? Does private ownership give you the
right to do anything you want with the things that you own? Explain. How does
private ownership infl uence the incentive of individuals to (a) take care of
things, (b) conserve resources for the future, and (c) develop and modify
things in ways that are benefi cial to others? Explain.
7. What is the law of comparative
advantage? According to the law of comparative advantage, what should be the
distinguishing characteristics of the goods a nation produces? What should be
the distinguishing characteristics of the goods a nation imports? How will
international trade infl uence people’s production levels and living standards?
13. Two centuries ago, there were
more buffalo than cattle in the United States. Even though millions of cattle
are killed for beef consumption each year, the cattle population continues to
grow while the buffalo are virtually extinct. Why?