Why does the development of economic models involve a number of assumptions that simplify the economy?

Answers:

Because economists are cunning people. They have to explain to people why economic patterns do not work with the same inevitable inevitability as, for example, physical ones. You threw a stone into the water and it drowned - there are no options. World oil prices and the price of gasoline in Russia have fallen... grew! Has this ever happened? But gasoline is made from oil. Raw materials are becoming cheaper and costs are falling. Gasoline must become cheaper! To explain such incidents, economists have a good excuse that economic laws work “under other conditions.” equal conditions"And since other conditions are never constant and “equal,” it is impossible to detect economic patterns unless you abstract from some minor factors and highlight the main ones to include them in the model. A good model is not one that includes everything or the maximum possible number of factors, and one that allows one to fairly reliably explain the dynamics of the resulting indicator, but at the same time is not very cumbersome.To achieve these goals, economists simplify reality.

Microeconomics Topic 1. Economic theory: subject, structure, functions plan:

Economic theory:

a) subject “Economics”;

b) microeconomics and macroeconomics;

c) positive and normative economics.

Economic research methods:

a) systematic approach, scientific abstraction;

b) economic model;

c) model of economic man.

Limitedness as a key problem of the economy:

a) people’s needs and means of satisfying them;

b) types of economic resources, their limitations;

c) absolute and relative limitation.

Problem economic choice.

a) economic choice as a way to solve the problem of limited resources;

b) the effectiveness of economic choice and the problem of its assessment; opportunity cost of choice;

c) short-term and long-term aspects of choice, labor productivity, investment;

d) the production possibilities curve as a model of economic choice.

Independent work

Draw a production possibilities curve using the following data:

2. Show point X on the graph (airplanes - 2, steaks - 9). How can you characterize the state of the economy at this point?

3. Show point Y on the graph (airplanes - 4, steaks - 11). How can you characterize the state of the economy at this point?

The introduction of new meat processing technology made it possible, given the given resources, to increase the maximum possible number of steaks produced to 18. Show on the graph the change in the production possibilities curve of the economy.

Rising birth rates led to an increase in the number of people employed in manufacturing both airplanes and steaks. Show on a graph the change in the economy's production possibilities curve.

What is the opportunity cost of the aircraft if its production increases from 1 to 2 units? What is the opportunity cost of the aircraft if its production increases from 3 to 4 units? Why is the opportunity cost per unit of aircraft not constant in this example?

Describe the concepts: “goods for the present”; "products for the future."

Let’s assume that two options for a plan for the production of goods were discussed in the country’s parliament:

What are the short term consequences of adopting different options plan?

What are the long-term consequences of adopting different plan options? Illustrate your answer with a graph showing the change in the economy's production possibilities curve.

Questions

Comment on the following statement: “In reality, economic theories are practical because they are abstractions.”

Can the system of abstractions (models) be the same when studying the economies of different countries and in different situations?

Is economics a laboratory science? What problems arise in the process of formulating and applying economic theories?

What is the criterion for dividing economic theory into two relatively independent parts: microeconomics and macroeconomics?

Comment on the statement: “Three economists, when discussing one issue, have, at least, four opinions."

“Basic for the economy: economic efficiency- social justice." What kind of judgment is this? How will the models differ?

Explain how you understand the limitlessness of needs?

Name the reasons causing the increase in people's needs. According to what parameters does the growth of needs occur?

Describe the fundamental problems of economics. Why do they exist in any society, regardless of its level of economic development?

How are resource limitations overcome? What new problem does this arise?

During the year, the Ulybka cafe extended its opening hours and organized the sale of fresh confectionery, which attracted a significant number of new visitors. From the factors listed below, select those that led to an increase in labor productivity and those that are associated with an increase in intensity (the degree of labor intensity above the socially normal level): a) family members were forced to work 10 hours a day and be content with one day off; b) a new confectionery production line was purchased; c) the confectioner at the Ulybka cafe completed a retraining course and mastered a new technology for producing biscuits; d) numerous smoking breaks and tea breaks for staff during the working day were eliminated; e) responsibilities were clearly divided between workers, and excess workers were fired.

Does the economically efficient activity of all individual producers ensure the economically efficient development of society as a whole? Explain why achievement by all individual entrepreneurs full employment resources owned by them does not automatically lead to a solution to the problem of full employment of all economic resources society?

Why does developing economic models involve a number of assumptions that simplify the economy?

Why is the production possibilities curve a model? What problem does it illustrate? this model?

TESTS

1. Economics can be defined as:

a) the science of the stock market;

b) the science of how society solves the questions of “what, how and for whom to produce”;

c) the science of how the state influences market activity;

d) the science of how to improve your personal financial situation.

2. Microeconomics studies:

a) the activities and economic behavior of individual economic entities (households, firms);

b) the functioning of the national economy as a whole;

c) the system of socio-economic relations that develop in the process of social production and the laws of its development;

d) a system of economic institutions that ensure the normal functioning of the economy.

3. Check the statements related to macroeconomics:

a) competition among computer companies has led to lower prices for their products;

b) the dollar exchange rate on the Moscow Interbank Currency Exchange reached its highest level in a week;

c) unfavorable weather conditions led to a poor potato harvest;

d) an increase in the price of gasoline in Lithuania led to an increase in costs in the baking industry of this country.

4. The following statement applies to normative economic theory:

a) by September 1993, prices for basic food products increased 6 times;

b) inflation has significantly reduced the standard of living of the population, and government policy should be aimed at reducing it;

c) 1999-2001 were a period of economic recovery for Russia;

d) the inflation rate in 2001 was 18.6%.

5. The Fundamental Problem Everyone Faces economic systems, This:

a) investments; c) consumption;

b) production; d) rarity.

6. Capital as a factor of production is:

a) a stock of production goods created for the production of other goods;

b) stocks, bonds and others financial assets, generating income;

c) networks of contacts and relationships that promote trust and facilitate economic interactions between people;

d) knowledge, skills and abilities of a person that can be used in the production process and which are the source of his income.

7. An economic good is:

a) a thing that satisfies existing needs and is available in limited quantities;

b) a thing or service that satisfies any need;

c) a thing or service that satisfies a need and is available in limited quantities;

d) a thing that satisfies existing needs.

8. An increase in labor productivity is manifested:

a) in increasing the time to produce a unit of product:

b) in increasing the costs of all production resources per unit of production;

c) in increasing production output per unit of time;

d) in reducing production output per unit of time.

9. The effective functioning of the economic system is reflected on the production possibilities graph:

a) a point lying outside the production possibilities curve;

b) a point lying inside the production possibilities curve;

c) the point lying on the production possibilities curve at which the most complete satisfaction of the needs of members of society is achieved;

d) any point on the production possibilities curve.

10. A point lying outside the boundaries of the production possibilities curve characterizes:

a) efficient use of available resources;

b) inefficient use of available resources;

c) unattainable with existing technology and resources;

d) efficient but unfair distribution of economic resources.

Answers: 1 b; 2 a; 3 b; 4 b; 5 g; 6 a; 7 in; 8 in; 9 g; 10th century

Topic 2. Market system

PLAN:

1. Basic coordination models economic activity of people:

a) the problem of coordinating economic activities;

b) models of traditional, command, market and mixed economy;

c) institutional foundations of a market system for coordinating economic activities.

2. Social division of labor - economic basis market system:

a) specialization and cooperation of labor; their impact on the efficiency of economic activity;

b) the principle of comparative advantage;

c) exchange, exchange mechanism, money and prices;

d) costs of economic activity in a market system.

3. Entrepreneurship and competition as driving forces of a market economy:

a) entrepreneurship;

b) principles of decision-making by an entrepreneur: opportunity cost;

c) competition as a mechanism of interaction between subjects market economy.

4. Circulation economic benefits, resources and income as the simplest model of a market system:

a) subjects of the market system, the principle of payment for factors of production;

b) a model of the circulation of economic goods, resources and income;

c) the equilibrium approach as a method of economic research.

The author mentions business cycles ( economic cycles). Explain why government intervention in the economy is necessary at certain periods of this cycle? Based on social science knowledge, indicate any two measures monetary policy, which the state can use in such situations.

Read the text and complete tasks 21-24.

An economic system can be viewed as a giant computing machine that tirelessly works to solve an endless stream of quantitative problems: problems of optimal distribution of labor and natural resources, capital, ensuring balanced growth rates in production and consumption of thousands of items of goods, distribution of the flow of output for consumption and investment, and many others...

Anyone who has worked with computers knows that they are not infallible and are prone to making mistakes. It happens that the procedure at some stages of calculations rather moves away from the correct solution of a given specific problem rather than leading to it. Under certain conditions, a sequence of approximate solutions begins to wobble, like a bicycle on a slippery road, deviating first in one direction or the other from the correct trajectory. Majority modern theories cycles business activity This is how fluctuations in the production and consumption of various goods and services are explained, and the available evidence seems to suggest that such an interpretation may, in fact, be correct.

When a machine is not performing as expected, it is natural to be tempted to intervene. Such intervention may consist of lubricating the bearing or tightening the nut. Sometimes we find it necessary to abandon the calculations on the machine and do at least some of them by hand.

Any kind economic policy or economic planning is a deliberate intervention in the workings of the competitive machine. If, in pursuit of their specific goals, politicians

use instruments such as tariffs, subsidies or taxes, then most economic calculations are still carried out by the economic mechanism; the adjustment adds new components to the computer, but does not really interfere with its automatic operation...

Like any other complex device, a competitive economy can fail under stress, which is what happens when it faces problems that are significantly different from those it has dealt with before. It is not surprising, therefore, that in the transition from peace to war or from war to peace, in the transition from long-term stagnation to rapid growth, or in the need for rapid and abrupt technological changes, the solution of the problems of achieving general equilibrium that arise before the economic computer can be facilitated by the use of external influence, i.e. planning.

(V. V. Leontiev)

What quantitative problems does the author think the economic system solves? List three problems. How does the author characterize economic policy?

Explanation.

The correct answer must contain the following elements.

1. The quantitative problems that the economic system solves are indicated:

Problems of optimal distribution of labor and natural resources, capital;

Problems of ensuring the pace of balanced growth in production and consumption of thousands of items of goods;

Problems of distribution of the flow of output for consumption and investment.

Economic policy is a deliberate intervention in the operation of the competitive machine.

Summary

Charts

Indexes

To determine the level and dynamics of many economic indicators indexes are used.

Let's assume that we are interested in the question of the development of housing construction in Russia in last years. Statistics show that in 1992 residential buildings with a total area of 41.5 million square meters were built. meters; in 1993 - 41.8 million sq. m; in 1994 - 39.2 million sq. m and in 1995 - 41.0 million sq. meters. These data clearly show the level of housing construction and indicate that in 1993 it increased, in 1994 it decreased, and in 1995 it increased again, without, however, reaching the level of 1992. But these data alone The data does not show how high the growth rate of housing construction was in 1993 and how significant the rate of its decline was in 1994. To get a clearer picture of the dynamics of the level of housing construction, let us take it in 1992 as 100%, then in 1993 it will be equal to 100.7%; in 1994 - 94.5% and in 1995 - 98.8%. Now we see that in relation to the level of 1992, housing construction in 1993 increased by 0.7%, in 1994 it decreased by 5.5% and in 1995 it was 1.2% lower than in 1992 The picture of housing construction dynamics is not distorted if we drop the “%” sign. In this case, the indicators of the level of housing construction in 1992-1995. are usually called indices, and the level taken as 100 units is called the base level.

The index method is used when considering the dynamics of the volume of output by industry and other sectors, consumer spending population, volume of exports and imports of goods, etc.

The index method is of great importance for determining the level and dynamics of prices, in particular the price level for consumer goods and services. We will return to these issues later when considering specific problems of the economy.

Economic analysis methods often rely on the use of graphs. A graph is a drawing that is used to visually depict the quantitative dependence of one economic value on a quantity. It assumes that there are two variables related to each other. There is a functional dependence between them (for example, the level of consumption on the amount of income). This functional dependence is described using one or another mathematical equation. It can also be presented in the form of a numerical table. The advantage of the graph is its clarity. Graphing is the way in which geometry, as one of the branches of mathematics, serves to describe economic model.

Man lives in a world of limited opportunities. The reason for this is that the numerous and evolving needs of people are limitless, but in every this moment limited quantity resources, used to produce everything people need.

The means by which people's needs are satisfied are called goods. Free goods are available in abundance, and the need for them can be satisfied by anyone who needs them. Economic goods are found in society in limited quantities and therefore are not available to everyone or are available in such quantities that do not allow everyone to fully satisfy their needs for these goods.

To produce economic goods, production factors consisting of three groups are used: Natural resources, capital and labor. Natural resources include everything that is given by nature in finished form and is used either as a condition for production or as a substance that is processed to produce the desired consumer item. Capital is the means of production made by people; they are necessary for the production of a good or service. Labor is capabilities man, which he uses to produce everything he needs for life.

Limited resources place a person in a situation of constant choice. The choice is associated with the search for answers to the three main questions of economics: WHAT to produce? HOW to produce? FOR WHOM TO PRODUCE? Item economic science- selection of directions and methods of using limited resources to meet the unlimited needs of people.

Microeconomics is the branch of economics that studies behavior economic units: individual consumer and producer, markets for specific goods. Macroeconomics is the branch of economics that studies large-scale economic phenomena affecting the economy as a whole.

Economists, trying to explore and substantiate the patterns of people's economic behavior, proceed from the fact that economic entities behave rationally. Rationality in people's behavior means, firstly, the purposefulness of their actions, secondly, the choice of criteria that guide them in striving to achieve their goal, thirdly, the determination of the price of the perfect choice, which is called opportunity cost, and fourthly, comparison of income received with costs incurred.

Opportunity cost is the best of the rejected options or what has to be sacrificed by making a choice in favor of another. This definition of opportunity cost is valid in a situation where, by choosing one option, all others are rejected. But if others cannot be completely rejected, “both are necessary,” then in this case the alternative cost appears as the amount of an alternative good that has to be sacrificed in order to increase the production of a good that we need in larger quantities.

In order to understand and explain how the economy functions and develops, it is necessary to identify from the whole variety of small and random facts and events the most important, most significant connections and dependencies between phenomena economic life. This suggests that an economist must develop and justify a theory that explains how an economy develops.

The development of economic theory is based on the construction of an economic model. An economic model is a simplified description of an economy that expresses a functional relationship between two or more variables.

In their research, economists rely on statistical material. When analyzing the economy, it is necessary to keep in mind that economic quantities have unequal dimensions. Some quantities that represent flows (output, income, etc.). have interval dimension; other quantities representing reserves (funds), for example capital, cost household goods etc., have moment dimension.

Economic analysis requires distinguishing between nominal and real indicators. It relies on the use of indices that provide a clear picture of the dynamics of economic values.

? Test questions and assignments

1. Name the reasons causing the increase in people's needs. What does it mean in in this case“growth”, is it only quantitative changes in needs?

2. How does the concept of “resources” differ from the concept of “factors of production”?

3. List all types of income that I receive! owners of factors of production.

4. Describe the fundamental problems of the economy. Why do they face any society, regardless of its level of economic development?

5. Give examples of rational and irrational human behavior.

6. Local authorities have allocated money for the construction of a children's leisure center in the area. What could be the opportunity cost of a child care center?

7. Everyone knows that football is much less necessary for people than food or steel. However, professional football players are paid much more than farmers or steel workers. Why?

8. What is the difference between positive economics and normative economics?

9. Why does developing economic models involve a number of assumptions that simplify the economy?

Chapter 2. Market economic system. Mixed economy

2.1 Two ways to solve fundamental economic problems

2.2 Administrative planning system

2.3 Market and its functions

2.4 Circulation of income in a market economy

2.5 Limited market opportunities. Mixed economy

After reading this chapter, you will learn:

How are fundamental issues solved? Problems economics;

What was the planning and administrative system and why did it collapse;

What is the market and what are its functions;

How does the circulation of income occur in a market economy?

Why a purely market system cannot function and develop successfully:

What role does the state play in the conditions of a market economy and what is a mixed economy;

What are the limits of government intervention in market economy .

In the previous chapter, we established that in any conditions, limited resources posed and poses three fundamental problems to society: what, how and for whom should be produced in order to best satisfy people’s needs for economic goods. We found out what the choice price (opportunity cost) and the production possibilities curve are. But we left aside the question of how the fundamental problems of the economy are solved? Meanwhile, it is the way of solving these problems that determines the main, most essential features of a particular economic system

LITERATURE

1. Nuraliev, S.U. Economics: textbook / S.U. Nuraliev, D.S. Nuralieva. - M.: Publishing and trading corporation "Dashkov and Co", 2015. - 431 p. : table, diagrams, graph. - (Educational publications for bachelors). - Bibliography in the book - ISBN 978-5-394-02412-2; Same [ Electronic resource]. - URL: //biblioclub.ru/index.php?page=book&id=419345 (01/13/2017).

2. Economic theory: textbook / ed. N.D. Eriashvili. - M.: UNITY-DANA, 2015. - 527 p. : ill. - Bible in the book - ISBN 978-5-238-02464-6; The same [Electronic resource]. - URL: //biblioclub.ru/index.php?page=book&id=446485(01/13/2017).

MICROECONOMICS

Topic 1. Economic theory:
subject, structure, functions

PLAN:

1. Economic theory:

a) subject “Economics”;

b) microeconomics and macroeconomics;

c) positive and normative economics.

2. Methods economic research:

a) systematic approach, scientific abstraction;

b) economic model;

c) model of economic man.

3. Limitedness as a key problem of the economy:

a) people’s needs and means of satisfying them;

b) types of economic resources, their limitations;

c) absolute and relative limitation.

4. The problem of economic choice.

a) economic choice as a way to solve the problem of limited resources;

b) the effectiveness of economic choice and the problem of its assessment; opportunity cost of choice;

c) short-term and long-term aspects of choice, labor productivity, investment;

d) the production possibilities curve as a model of economic choice.

LITERATURE

1. Nuraliev S.U. Economy. Decree. op. pp. 12-44.

2. Economic theory: textbook. Decree. op. pp. 11-21.

INDEPENDENT WORK

Draw a production possibilities curve using the following data:

2. Show point X on the graph (airplanes - 2, steaks - 9). How can you characterize the state of the economy at this point?

3. Show point Y on the graph (airplanes - 4, steaks - 11). How can you characterize the state of the economy at this point?

4. The introduction of new meat processing technology made it possible, given the given resources, to increase the maximum possible number of steaks produced to 18. Show on the graph the change in the production possibilities curve of the economy.

5. The rise in the birth rate led to an increase in the number of people employed in the production of both airplanes and steaks. Show on a graph the change in the economy's production possibilities curve.

6. What is the opportunity cost of an aircraft if its production increases from 1 to 2 units? What is the opportunity cost of the aircraft if its production increases from 3 to 4 units? Why is the opportunity cost per unit of aircraft not constant in this example?

7. Describe the concepts: “goods for the present”; "products for the future."

8. Suppose that two options for a plan for the production of goods were discussed in the country’s parliament:

What are the short-term consequences of adopting different plan options?

What are the long-term consequences of adopting different plan options? Illustrate your answer with a graph showing the change in the economy's production possibilities curve.

QUESTIONS

1. Comment on the following statement: “In reality, economic theories are practical because they are abstractions.”

2. Can the system of abstractions (models) be the same when studying economics? different countries and in different situations?

3. Comment on the statement: “Three economists, when discussing one issue, have at least four opinions.”

4. “Basic for the economy: economic efficiency - social justice.” What kind of judgment is this? How will the models differ?

5. Explain how you understand the limitlessness of needs?

6. Name the reasons causing the increase in people's needs. According to what parameters does the growth of needs occur?

7. Describe the fundamental problems of the economy. Why do they exist in any society, regardless of its level of economic development?

8. How are resource limitations overcome? What new problem does this arise?

9. During the year, the cafe “Smile” extended its opening hours and organized the sale of fresh confectionery, which attracted a significant number of new visitors. From the factors listed below, select those that led to an increase in labor productivity and those that are associated with an increase in intensity (the degree of labor intensity above the socially normal level): a) family members were forced to work 10 hours a day and be content with one day off; b) a new confectionery production line was purchased; c) the confectioner at the Ulybka cafe completed a retraining course and mastered a new technology for producing biscuits; d) numerous smoking breaks and tea breaks for staff during the working day were eliminated; e) responsibilities were clearly divided between workers, and excess workers were fired.

10. Why does developing economic models involve a number of assumptions that simplify the economy?

11. Why is the production possibilities curve a model? What problem does this model illustrate?

Topic 2. Market system

PLAN:

1. Basic models of coordination of economic activities of people:

a) the problem of coordinating economic activities;

b) models of traditional, command, market and mixed economies;

c) institutional foundations of a market system for coordinating economic activities.

2. Social division of labor - the economic basis of the market system:

a) specialization and cooperation of labor; their impact on the efficiency of economic activity;

b) the principle of comparative advantage;

c) exchange, exchange mechanism, money and prices;

d) costs of economic activity in a market system.

3. Entrepreneurship and competition as driving forces of a market economy:

a) entrepreneurship;

b) principles of decision-making by an entrepreneur: opportunity cost;

c) competition as a mechanism of interaction between subjects of a market economy.

4. The circulation of economic goods, resources and income as the simplest model of a market system:

a) subjects of the market system, the principle of payment for factors of production, wealth and income;

b) a model of the circulation of economic goods, resources and income;

c) the equilibrium approach as a method of economic research.

LITERATURE

1. Nuraliev S.U. Economy. Decree. op. pp. 20-24.

2. Economic theory: textbook. Decree. op. pp. 21-21, 31-36.

INDEPENDENT WORK

1. Fill out the table: Models of coordination of economic activities

2. Data on production (in units) in countries A and B are presented in the table. Determine the opportunity cost of producing the goods.

Which country will specialize in oil production, and which in the production of robots?

Will trade between countries A and B be mutually beneficial in the short and long term?

How will specialization affect the rate of socio-economic development of countries A and B?

3. List examples of transaction costs of operating a retail store.

4. Fill out the table:

5. Draw a model of the circulation of goods, resources and income. Using the circuit model, answer the following questions: a) How are the volume and structure of production related to the nature of the distribution of income between economic entities? b) Does the technological choice of the manufacturer depend on the income structure economic entities? c) What properties of the model can be identified in the circulation model? d) What assumptions are used when constructing a model of the circulation of economic goods, resources and income?

QUESTIONS

1. Explain why the traditional economic system is characterized by conservatism, while in a market economy the processes of specialization and cooperation accelerate? What advantages could a command-administrative system have in deepening the social division of labor? Why did the command-administrative system turn out to be unresponsive to the introduction of scientific and technical developments?

2. Why does economic theory focus not on specific country economic systems, but on four main models? By what criteria are models identified? Is it possible to have a “pure” market or command system?

3. Explain how the “invisible hand” of the market reconciles the selfish interests of private entrepreneurs with the interests of the rest of society.

4. Comment on the following statement: “society has long learned that self-sufficiency breeds inefficiency.”

5. What losses arise in society as labor specialization increases?

6. Why is it profitable for an American dairy farmer to buy butter in a store? Why might it be more profitable for a Russian peasant to make everything from milk himself for his own consumption?

7. The famous basketball player decided that his calling was to help homeless people. What is better for him to do for this: continue to play basketball or cook dinners for the homeless?

8. Lawyer Pavel Vladimirovich is one of the popular lawyers in the country. In addition, he drives a car professionally, works well and quickly on a computer, performing the duties of a secretary. Should a lawyer print his own documents if the best secretary he can hire will do it slower than Pavel Vladimirovich himself? Prove that it is profitable for a lawyer to hire a secretary and a driver.

9. Suppose that in the USA, 1 car can be produced in 200 hours, and it takes 20 hours to produce 1 ton of rice. In Japan, it takes 150 hours to produce 1 car, and 50 hours to produce 1 ton of rice. What is the opportunity cost of producing 1 car and 1 ton of rice in each country? Which product will the United States specialize in and which will Japan specialize in?

10. Why does the state oblige the manufacturer to indicate on the packaging the expiration date and the main components of the food products produced, and the merchant to have a quality certificate for the goods he sells?

11. The most important factor The development of mass production of cars in the USA was the increase in the minimum daily wage of a worker from 2 dollars in 1914 to 5-6 dollars in the mid-1920s, initiated by the entrepreneur G. Ford. Why, without such an increase in the price of labor, there would not have been a “breakthrough” in the automotive industry.

LITERATURE

1. Nuraliev S.U. Economy. Decree. op. pp. 49-59.

2. Economic theory: textbook. Decree. op. pp. 76-92.

INDEPENDENT WORK

1. The scales of supply and demand on the tomato market are given:

a) Draw the supply and demand curves for tomatoes and find the equilibrium price and equilibrium quantity.

b) What will happen - a shortage or surplus of tomatoes on the market if the government sets the maximum permissible price - 12 rubles. and 20 rubles? Explain why it is desirable that the introduction of price ceilings be accompanied by government policy consumption rationing? Why is it that in the case of state minimum prices, “half” prices, either a policy of purchasing surpluses, or a policy of limiting production, or stimulating demand is desirable?

2. Show on the graph and give a verbal description of how the equilibrium price and equilibrium quantity sold will change in the following cases:

Question	Schedule	Answer
a) government to maintain Agriculture introduces a subsidy for every kilogram of tomatoes grown;
b) the number of tomato lovers in the country has increased;
c) the price of tomato seedlings has increased;
d) the price of orange juice has decreased;
e) a new technology for applying fertilizers has been introduced;
e) the number has decreased farms;
g) wages of workers on subsidiary farms increased;
h) the price of eggplants has decreased, the production of which requires, to a greater extent, the same technology and the same resources as the production of tomatoes;
i) this year there will be a rich tomato harvest, and the government will increase the minimum wage by October;
j) the popularity of tomato juice is growing and rent for the land;
k) the price of cucumbers decreases during the period of pickling vegetables and a high harvest of tomatoes is harvested at the same time.

3. Population demand function for cars is described by the formula: Sentence function: . Calculate the equilibrium price and equilibrium sales volume of automobiles. Plot the demand and supply functions on a graph.

How will the equilibrium price and equilibrium quantity change if the government imposes a scrappage tax on cars? If the program is extended preferential lending buying a car?

4. Fill out the table:

Type of elasticity	Formula	Meaning	Type of product(s)
Price Elasticity of Demand		\| \| →+∞
\| \|> 1
\| \|= 1
\| \|< 1
\| \|= 0
Income Elasticity of Demand		<0
>0
>1
Cross elasticity of demand


Elasticity of supply

QUESTIONS

1. Are the statements “the market satisfies the needs of consumers” and “the market satisfies the demand of buyers” identical?

2. How will the demand for red caviar change with an increase in population income? What will happen to the demand for millet cereals as household incomes increase? What will happen to the demand for salt as household incomes increase?

3. Are the concepts of “quantity of demand” and “demand” identical? In what cases are they used? Is the concept of “demand” used correctly in the statements below, or should it be replaced by the concept of “quantity of demand”: a) when OPEC raised oil prices in the 1970s, the demand for oil fell; b) when the Iran-Iraq war broke out, panic began among oil refining companies, pushing up demand for oil .

4. What impact might information about drought and grain crop failure have on demand? How will the level of consumption change? What is a “self-fulfilling forecast”?

5. What happens to the demand curve for beef if the price of poultry increases?

6. What will happen to the wheat supply curve if prices for mineral fertilizers increase?

7. Suppose that, thanks to the active work of the Animal Welfare Society, many people stopped buying leather jackets. But sellers of leather jackets managed to keep prices at the same level. How did the sellers manage to do this?

8. In the second half of the 1970s. Western European coffee consumption per capita fell and the price rose. Explain this phenomenon.

9. Comment on the following statement: “prices unload the market.”

10. If suddenly in December the supply of Christmas tree decorations turns out to be unexpectedly small, do you think there will be a shortage and queues? Which economic functions does the queue?

11. Show on the graph: a) why the state’s establishment of a price “floor” is accompanied by a surplus of production; b) the establishment of a “price ceiling” by the state is accompanied by a shortage of products.

12. What is the importance of balancing the market? What problems arise in the economy in disequilibrium or unstable equilibrium markets?

13. At the beginning of 1992, a group of Omsk economists proposed constructing supply and demand curves, determining the equilibrium price on their basis, and fining producers for exceeding this price. Was it possible to implement this proposal in practice?

14. Name economically sound arguments for and against government regulation prices

15. Explain how humanitarian assistance is provided developing countries capable of solving developed countries' own problems.

16. The state would like to increase its revenues. On what goods will it impose excise taxes? Will the elasticity of demand for them be taken into account?

17. How, from the point of view of price elasticity of demand, can we explain the range of goods in trade pavilions on bus stops?

18. What characteristics of the demand for agricultural products are associated with the following statements: “for farmers, harvesting a large harvest may be undesirable” and “increasing farmers' income depends on limiting farm production”?

19. From the point of view of price elasticity, what is the demand for: a) soap; b) for a certain type of soap; c) salt; d) cars; e) tickets to football matches; e) textbook on economics.

20. How does ignorance affect the elasticity of demand?

Topic 4. The company, its main organizational
forms, purpose of activity

PLAN:

1. Firm as a form of organization entrepreneurial activity:

a) enterprise, firm, industry;

b) forms of combining enterprises into a company: horizontal and vertical integration, diversification, conglomeration;

c) company as economic organization;

d) R. Coase's theory of the firm.

2. Organizational and legal forms of the company, their advantages and disadvantages:

a) sole proprietorships;

b) partnerships;

c) corporations.

3. Corporation as the leading form of modern business organization:

A) general principles organization of management of the corporation's activities;

b) main types valuable papers, issued by the corporation;

V) controlling stake shares

4. Target orientation of the company:

a) separation of property from entrepreneurship;

b) modification of the target orientation of the company’s activities in the context of a corporate business organization;

c) short-term and long-term goals of the company.

LITERATURE

1. Nuraliev S.U. Economy. Decree. op. pp. 99-109.

2. Economic theory: textbook. Decree. op. pp. 109-115, 123-127.

INDEPENDENT WORK

1. Fill out the table “Forms of business combinations”:

2. Determine which of the listed characteristics relate to the advantages and which to the disadvantages of this or that form of business organization. Enter the characteristics in the appropriate columns of the table. Please note that some features may be listed more than once.

· simplicity of organization (institution, management, etc.);

· freedom of action (there is no need for coordination when making decisions);

· strong economic motivation (receipt of all profits by one person);

limited financial and material resources(associated both with the lack of funds of one’s own company and with the difficulty of obtaining money from outside);

· absence developed system internal specialization of production and management functions;

· unlimited property liability;

· specialization in management;

· inconsistency of actions and/or incompatibility of interests of owners;

· quick attraction of additional financial resources;

· limited property liability;

· relative stability of the company;

· relative instability of the company;

· reducing the risk of business activity;

· the possibility of abuse as a result of the separation of ownership and management functions;

Possibility of association financial resources several persons;

· the owner is his own master;

· the easiest way to organize a business;

· the possibility of losing control over the company while remaining its owner;

· possibility of double taxation;

· relative complexity of establishment and registration;

· the sale of ownership of capital will not cause damage to the enterprise.

3. Fill out the table “Types of securities issued by a joint stock company”:

4. Fill out the table “Main models of organizational and legal forms of entrepreneurial activity”:

QUESTIONS

1. Explain the following from the point of view of R. Coase’s theory of the firm: during privatization, individual enterprises of vertically integrated companies separated from each other, they also left industry subordination. Later, on their basis, new large companies are formed.

2. What is the function in economic development does the company have unlimited property liability? What role does limited property liability play in the economic development of society?

3. Explain and evaluate the following statement: “Choice legal form", which the enterprise accepts, is dictated primarily by the financial needs of a particular area of production."

4. What comes together in a partnership? What does a corporation unite?

5. Why is registering a joint stock company a complex procedure? How can we explain the fact that the bankruptcy of large joint stock companies happens very rarely, but bankruptcies of small sole proprietorships are common?

6. Where is the owner's risk of losing his property as a result of any innovative actions higher: in a sole proprietorship, in a partnership or in a corporation? Why do small innovative firms create many new products, but their mass production is mastered by large corporations?

7. Typically the controlling interest is significantly less than 51%. With what it can be connected?

8. How can you appreciate the fact that corporations in the United States make up only 18% of all firms, but they account for almost 9/10 of total sales of goods and services. Why then are “small businesses” called “the backbone of the economy”?

9. Is the property of a corporation the property of the shareholder?

10. Comment on the following statement: “... a shareholder is just an abstraction, a stupid and faceless manager of money who buys shares if there is a rumor that they have risen in price, and sells them at the first hint to the contrary.” What does a player do on the stock exchange?

Topic 5. Firm: costs and output,
scale of activity

PLAN:

1. Company production:

a) production technology;

b) technological and economic efficiency;

c) the technological choice of the company.

2. Economic costs and economic profit of the company:

a) accounting and economic costs;

b) accounting and economic profit;

c) the condition for the market stability of the company.

3. The optimal volume of production of the company in the short term:

a) total and average, fixed and variable costs;

b) optimal production volume;

c) the break-even point and the closing point of the company.

4. Minimum effective enterprise size:

a) positive, negative and constant economies of scale;

b) the minimum effective size of the enterprise;

c) natural monopoly.

LITERATURE

1. Nuraliev S.U. Economy. Decree. op. pp. 111-114.

2. Economic theory: textbook. Decree. op. pp. 115-121.

INDEPENDENT WORK

1. Production at the company is characterized by the data given in the table. Calculate the indicators and fill out the table. Draw on a graph the dynamics of total, average and marginal costs. At what point will the firm produce the optimal amount of output?

Q	V.C.	F.C.	TC	AVC	A.F.C.	A.C.	MS
thousand units	thousand roubles.	rub./unit

2. The function of the firm’s total (total) costs has the form:

Write expressions reflecting the function of fixed costs, variable costs, average fixed costs, average variable costs, as a function of output volume.

Construct graphs: fixed costs, variable costs, average fixed costs, average variable costs of the company.

3. Ivanov owns a small company producing ceramic products. He invested 40 thousand rubles in production equipment; it will serve him for 10 years. With a different placement, this amount of money could bring him 5 thousand rubles. in year. He hires one assistant for 12 thousand rubles, pays 5 thousand rubles for rent of the premises, 20 thousand rubles for raw materials. Ivanov’s competitor offers him a job with an annual salary of 13 thousand rubles. Ivanov estimates his entrepreneurial talent at 3 thousand rubles. Total annual income is 60 thousand rubles. Calculate: a) the amount of annual depreciation charges; b) the amount of accounting and economic costs; c) the amount of accounting and economic profit. Will Ivanov leave this business? Why are family businesses extremely resilient?

QUESTIONS

1. What is the technology for preparing homemade lunch? Is it effective to feed a family using large quantities of “convenience” foods? Under what conditions will semi-finished products displace domestic labor?

2. It is known that in the USSR prices for natural resources and labor were significantly lower than world prices, and equipment was expensive. What technological choice was characteristic of the USSR from the point of view of the rule of least cost.

3. Why do average total, average variable, and marginal cost curves appear U-shaped? Why can't average fixed cost curves take this shape?

4. Why in the short term can costs be divided into fixed and variable? Determine which category of costs the following types of costs belong to: a) costs of purchasing fuel; b) payment of interest on bonds issued by the company; c) costs of raw materials; d) expenses for wages workers; d) depreciation deductions; e) insurance premiums; g) payment for rented equipment; h) payment of property taxes.

5. Can the same cost item in one case relate to variable costs, and in another - to fixed costs? “There are no fixed costs in the long run; All costs are variable." Explain this statement.

6. If you had the opportunity to open a car wash station with fixed annual costs of 100 thousand rubles and variable costs at 0.5 rub. for each car, then under what condition would you invest your capital in this business? It should be noted that market price car wash services - 1.5 rubles. Does the location of the sink matter? How might this affect land rental fees?

7. In 1955 Sony was small and had only a small production site. When the company received an order for 100 thousand of its first transistors at a price of $29.95, A. Morita (the company’s representative in the USA) refused such an order as unprofitable. An order for only 10 thousand receivers was accepted. Explain this using the concept of fixed and variable costs.

8. What is the nature of negative and positive economies of scale?

9. In 1970-80 The world's largest corporations have taken the path of decentralization of management and the allocation of autonomous, competing production departments. What do you think is the reason for this, and what results can it bring?

10. In the Russian Federation, dozens of joint projects with foreign companies for the assembly of cars were developed. Were they all implemented? Why is the implementation of all projects ineffective?

Topic 6. Basic market models.
Competition and monopoly

PLAN:

1. Character traits main market models:

a) signs of identifying the main models market competition;

b) the model of perfect competition and its role in economic theory.

2. Imperfect competition:

a) market power, forms of its implementation and reasons for its occurrence;

b) pure monopoly, “barriers” to entry into the industry;

c) product differentiation, non-price competition and monopolistic competition model;

d) oligopoly and its types.

3. The problem of production efficiency and resource distribution in the conditions of basic market models:

a) efficiency of production and distribution of resources in conditions of perfect competition;

b) efficiency problems in the context of a firm acquiring market power;

c) problems of static and dynamic efficiency.

4. Antimonopoly regulation of the market:

a) criteria for concentration of production and market monopolization;

b) basic principles of antimonopoly regulation of the economy;

c) features of regulation of natural monopoly.

LITERATURE

1. Nuraliev S.U. Economy. Decree. op. pp. 95-97.

2. Economic theory: textbook. Decree. op. pp. 130-154.

INDEPENDENT WORK

Fill the table:

Comparison options	Perfect Competition	Imperfect competition
Monopolistic competition	Oligopoly	Monopoly
Number and size of firms
type of product
Conditions for entering the industry
Price control
Nature of competition
Profit margin
Availability of resources for investment