瑞士酒店大学microeconomics2.pptx

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1、Session2Trade,TradeoffsEconomicSystems2LEARNINGOBJECTIVESIdentifythepurposeofexchangeExplaintheperiodsofexchangeprocessIdentifythedifferencebetweenexchangeandthetermsofexchangeExplainhowconsumers’surplusandproducers’surpluscanbeusedineconomicsIdentifythethreeeconomicquestionsthateverysocietymustan

2、swer3Listanddescribetypesofeconomies(economicsystems)ExplaintheadvantagesanddisadvantagesofeacheconomicsystemListthesectorsofproductionsDifferentiateactivitiesinthesectorsofproductionsRef:Arnold,2001,ch.2,pp.31-47;50-52LEARNINGOBJECTIVES(cont’d)4EXCHANGEORTRADEDefinition:Theprocessoftradingonething

3、foranother.Whydopeopletrade?Tomakethemselvesbetteroff.Example:5TIMERELEVANTTOEXCHANGEThereare3periodsrelevanttoexchangeprocess:ExAnte-beforethetradeorexchangeismade.AtthePointofExchangeorTrade.ExPost-afterthetradeismade.Giveexampleforeachperiod.6EXCHANGEANDTERMSOFEXCHANGEExchangeistheprocesswheret

4、hings(money,goods,services,andsoon)aretradedorexchanged.TermsofExchangerefertohowmuchofonethingistradedforhowmuchofsomethingelse.Forexample…7CONSUMERS’ANDPRODUCERS’SURPLUSConsumers’Surplus(CS)=Max.Buying(abletopay)PriceMINUS(-)ActualPricePaidProducers’Surplus(PS)=PriceReceived(paidbybuyers)MINUS(-)

5、MinimumSellingPrice8Q&AWhatisproducers’surplus?Whoprefersit?Why?Whatisconsumers’surplus?Whoprefersit?Why?9TRANSACTIONCOSTS???Dopotentialexchangesturnintoactualexchanges???Transactioncostsarethetimeandeffortneededtosearchout,negotiate,andcarryoutanexchange.Howcantransactioncostsbelowered?103ECONOMIC

6、QUESTIONSEverysocietymustanswertheseeconomicQs:Whatgoodswillbeproduced?tradeoff:moreschoolsormorehospitals?Howwillthegoodsbeproduced?where&howtoproduce,andwhomakesdecisionsonproduction?Forwhomwillthegoodsbeproduced?anyonewhoisableandwillingtopaytheprice?orwillthegovernmentdecidewhowillhavethegoods?

7、11ECONOMICSYSTEMSDefinition:thewayinwhichsocietydecidestoanswerthethreeeconomicquestions:what…,how…,forwhom…3typesEconomicSystems:Capitalist(Market)Socialist(Planned/Command)Mixed12PRICE/MARKETECONOMYPurema