Survey of Economics

by O'Sullivan, Arthur; Sheffrin, Steven

• ISBN13: 9780131439696
• ISBN10: 0131439693
• Edition: 2nd
• Format: Paperback
• Copyright: 2005-01-01
• Publisher: Pearson College Div

Summary

Covering both Micro and Macroeconomics in one concise paperback volume, this book shows readers how to think and act like an economist by showing them how to use economic concepts in their everyday lives and careers.Organized around the Five Key Principles of EconomicsThe Principle of Opportunity Cost, The Marginal Principle, The Principle of Diminishing Returns, The Spillover Principle, and The Reality Principle.For economists and those making financial decisions and analyses.

Table of Contents

Preface	xix
Principles of Economics	1	(32)
What Is Economics?	2	(4)
Resources---The Factors of Production	2	(1)
Production Possibilities	3	(2)
Markets and the Invisible Hand	5	(1)
The Economic Way of Thinking	6	(5)
Positive and Normative Economics	7	(1)
Use Assumptions to Simplify	8	(1)
Explore the Relationship Between Two Variables	9	(1)
Think Marginal	9	(1)
Mircoeconomics and Macroeconomics	10	(1)
The Principle of Opportunity Cost	11	(2)
Using the Principle: Warships, Security, and Collectibles	12	(1)
Using the Principle: The Opportunity Cost of a College Degree	13	(1)
The Marginal Principle	13	(3)
Example: Pedaling for Television Time	14	(1)
Using the Marginal Principle: Renting College Facilities	15	(1)
The Principle of Diminishing Returns	16	(2)
Diminishing Returns in the Short Run	17	(1)
What About the Long Run?	18	(1)
The Spillover Principle	18	(2)
The Reality Principle	20	(1)
Using the Reality Principle: Government Programs and Statistics	21	(1)
Using the Tools	21	(4)
Economic Experiment: Producing Foldits	21	(1)
What's the Cost?	22	(1)
How Much Ram?	22	(3)
Appendix: Using Graphs and Formulas	25	(8)
Supply, Demand, and Market Equilibrium	33	(30)
The Demand Curve	34	(3)
The Individual Demand Curve and the Law of Demand	35	(1)
From Individual to Market Demand	36	(1)
The Supply Curve	37	(3)
The Marginal Principle and the Output Decision	38	(1)
Individual Supply and the Law of Supply	39	(1)
Individual Supply to Market Supply	39	(1)
Market Equilibrium	40	(2)
Excess Demand Causes the Price to Rise	40	(1)
Excess Supply Causes the Price to Drop	41	(1)
Market Effects of Changes in Demand	42	(4)
Change in Quantity Demanded Versus Change in Demand	42	(1)
Increase in Demand	43	(1)
Market Effects of an Increase in Demand	44	(1)
Decrease in Demand	44	(1)
Market Effects of a Decrease in Demand	45	(1)
Normal Versus Inferior Goods	46	(1)
Market Effects of Changes in Supply	46	(5)
Change in Quantity Supplied Versus Change in Supply	47	(1)
Increase in Supply	47	(1)
Market Effects of an Increase in Supply	48	(1)
Decrease in Supply	48	(1)
Market Effects of a Decrease in Supply	49	(1)
Market Effects of Simultaneous Changes in Demand and Supply	50	(1)
Applications	51	(2)
Changes in Demand: Product Safety, Population Growth	52	(1)
Changes in Supply: Weather, Technology	52	(1)
The Economic Detective	53	(3)
Market Equilibrium, the Invisible Hand, and Efficiency	56	(1)
Using the Tools	57	(6)
Economic Experiment: Market Equilibrium	57	(1)
Using Data to Draw a Demand Curve	57	(1)
Foreign Farm Workers and the Price of Berries	58	(1)
Market Effects of an Import Ban on Shoes	58	(1)
The Mystery of Free Used Newspapers	58	(5)
Elasticity: A Measure of Responsiveness	63	(18)
The Price Elasticity of Demand	64	(4)
Elasticity and Substitutes	65	(2)
Other Determinants of Elasticity	67	(1)
Using the Price Elasticity of Demand	68	(4)
Predicting Changes in Quantity Demanded	68	(1)
Applications: College Education, Highway Deaths, Medical Care	69	(1)
Predicting Changes in Total Revenue	69	(2)
Applications: Transit Deficits, Property Crime	71	(1)
Economic Detective: The Video Elasticity Mystery	72	(1)
The Price Elasticity of Supply	72	(2)
Predicting Price Changes Using Price Elasticities	74	(2)
Using the Tools	76	(4)
Projecting Transit Ridership	76	(1)
Bumper Crops	76	(1)
Washington, D.C., Gas Tax	77	(1)
College Environment and Housing	77	(3)
Appendix: Using the Midpoint Formula to Compute Price Elasticity	80	(1)
Production and Cost	81	(24)
Introduction	82	(1)
Economic Profit Versus Accounting Profit	82	(1)
Short-Run Versus Long-Run Decisions	83	(1)
Production and Cost in the Short Run	83	(7)
Production and Marginal Product	84	(2)
Short-Run Total Cost and Short-Run Marginal Cost	86	(2)
Short-Run Average Cost Curves	88	(1)
The Relationship Between Marginal and Average Curves	89	(1)
Economic Detective: The Cost of Pencils	90	(1)
Production and Cost in the Long Run	91	(4)
Expansion and Replication	91	(2)
Decrease in Output and Indivisible Inputs	93	(1)
Decrease in Output and Labor Specialization	94	(1)
Economies of Scale	95	(1)
Actual Long-Run Average Cost Curves	95	(5)
Minimum Efficient Scale	97	(1)
Diseconomies of Scale	98	(1)
Application: Trucking Services	99	(1)
Short-Run Versus Long-Run Cost	99	(1)
Using the Tools	100	(5)
Production Consultant	100	(1)
Cost of Breaking Up an Aluminum Firm	100	(1)
Cost of Hospital Services	100	(5)
Perfect Competition: Short Run and Long Run	105	(1)
The Short-Run Output Decision	106	(1)
The Total Approach: Computing Total Revenue and Total Cost	107	(1)
The Marginal Approach	107	(2)
Economic Profit	109	(1)
Economic Detective: The Turnaround Artist	110	(1)
The Shut-Down Decision	110	(1)
Total Revenue Versus Total Variable Cost	111	(1)
Why Operate an Unprofitable Facility?	112	(1)
Short-Run Supply Curves	113	(1)
The Short-Run Supply Curve of the Firm	113	(1)
The Market Supply Curve	114	(1)
The Long-Run Supply Curve for an Increasing-Cost Industry	114	(2)
Production Costs and the Size of the Industry in the Long Run	116	(1)
Drawing the Long-Run Market Supply Curve	116	(2)
Examples of Increasing-Cost Industries: Sugar, Rental Housing	118	(1)
Market Equilibrium Revisited	119	(1)
Increase in Demand and the Incentive to Enter	119	(1)
The Long-Run Effects of an Increase in Demand	120