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Applied Economics

Applied Economics focuses on economic theories and econometrics (mathematical and statistical methods used in economics) and how they can be used to address and improve economic issues. Applied economics looks at real-world problems in the public and private sectors through an economic perspective, in order to determine the weaknesses and how to improve a company, country, or household. Generally speaking, applied economics is the empirical study of economics.

Applied economics is relevant to our own lives because it gives us a clear, concise image of an economic situation, without the influence of bias. This helps us determine a way to improve how our economy functions. Economic theories are formed by looking at how historical events have impacted the economy and how the economy rebalances itself. Applied economics tests these theories against empirical evidence to see if they actually hold true. The main goal is to distinguish between correlation and causality; economics is interested in causal relationships but these are easily confused with correlations. 

This area of economics covers a wide array of topics and the categories that fall under applied economics relate to how our lives are affected by changes in the economy. The topics that fall under applied economics are as follows: labour economics, monetary economics, nature resource economics, and public economics.

Categories within Applied Economics

Labour Economics

Postings: 155

Labour economics is the study of the interaction between firms, workers, and the government and is analyzed by employment and wages.

Natural Resource Economics

Postings: 32

Natural resource economics focuses on the supply, demand, and allocation of natural renewable and nonrenewable natural resources.

Public Economics

Postings: 36

Public economics studies how the government impacts the public market by looking at how the production of good and services are affected by government policies.

Three Basic Economics Questions

***This is not a request for a written paper, but points to expound on.*** Write a 2-3 page thorough analysis of the three basic economic questions along with an analysis of the centralized command and control system, the price system, and the mixed economic system. Remember to cite your research and do not plagiarize.

Various Topics in Elasticities, Auctions, and Cost Curves

2. Suppose market demand and supply are given by Qd = 100 - 2P and QS = 5 + 3P. The equilibrium quantity is: 1)92. 2)81. 3)45. 4)62. 3. Having worked for many of the firms in the petroleum industry, you know that the price elasticity of demand for a representative firm is about −1.25. Moreover, a recent report from an e

Lemon Laws Market Efficiency

Incomplete information frequently lowers the average quality of products and services exchanged in markets. This phenomenon, at times called the "lemons problem," explains why the supply of lower-quality products increases relative to higher quality products when sellers cannot communicate the quality of their products to potent

Compensation Plan Structures

Last year the owner of an auto dealership changed her sales manager's compensation plan. Previously, the manager received a fixed compensation. After the change, the manger's compensation was based on a percentage of sales. Compared to last year, sales have increased substantially but profits declined. Using economic analysis, e

Price Elasticity and Price Discrimination

You operate a small but popular and profitable restaurant/bar in a college town. There are several other restaurants and bars nearby. You have conducted a market research study and discovered that the price elasticity of demand for local residents is lower (less elastic) than the price elasticity of demand for college students,

Patent Protection: Pharmaceutical Industry

Using supply and demand and competitive analyses, explain what happens to a pharmaceutical company's revenues and profits from an individual drug once it loses its patent protection. Then identify at least one strategy the company can use to mitigate the losses; be sure to support your suggestion using economic analysis.

Economies of Scale/Scope

Explore how a firm determines the optimal scale of a plant for a given rate of output and why this determination relates to longer-run strategies versus current operations. Also, discuss the differences between economies of scale and economies of scope and how firms can benefit from each. Then, provide a specific company exa

Monetary Policy, Enron, and Business Ethics

Discussion 1 -What is monetary policy? How does the Fed increase money supply? -What is the effect of an increase in money supply? -Explain how government deficits lead to increases in the money supply. -How does monetary policy affect a company's financial status? Answer this question from both a profitability and balance s

Demand and Supply Equations with Equilibrium and Graphing

1. It has often been said that craft unions (electricians, carpenters, etc.) possess considerably greater power to raise wages than do industrial unions (automobile workers, steel workers, etc.). How would you explain this phenomenon in terms of demand elasticity? 2. What would you expect to happen to spending on food at h

Supply and Demand

1. The following function describes the demand condition for a company that makes caps featuring names of college and professional teams in a variety of sports. Q = 2,000 - 100P where Q is cap sales and P is price. a. How many caps could be sold at #13 each? b. What should the price be in order for the company to sell 1,0

Calendar for Product Pricing

Staff members and the board of the Knotfer Prophet Agency have decided to express the dramatic side of well-known and respected community and agency supporters with a calendar that each month displays one of them in a costume that reflects the happenings of that month. The photographs are funny and tasteful. For instance, the ma

Inelastic demand and increased prices

If the demand for a product is inelastic, what will happen to total revenue if price is increased? Below is my response but I need more words. The total revenue will increase. When demand is inelastic, a given percentage increase in price corresponds to a smaller percentage decrease in quantity demanded. Thus total revenue

The Herfindahl-Hirshman Index

Industry A is composed of five large firms and 100 small firms. The market shares of the five largest firms are, respectively, 30, 25, 20, 15, and 10. The 100 small firms together have the remaining market share. Calculate the Herfindahl-Hirshman index and determine what degree of concentration it exhibits. Would it be considere

Effective human resource management policy and practice

"Skills deemed to be necessary for employees include the academic basics, including proficiency in reading, writing and computation; self-management skills, such as self-esteem, motivation, goal-setting ability, and a willingness to participate in career development activities; social skills, such as interpersonal, negotiation,

Hospital administrator

You are the hospital administrator, and this situation has been brought to your attention. The mother of a pregnant minor seeks to obtain the daughter's medical records because she wishes to see if the daughter indicated to hospital personnel the identity of the father of her unborn child. The patient is a 12-year-old, unmarried

An insured patient is admitted to a hospital

An insured patient is admitted to a hospital. Compare the advantages and disadvantages of fee-for-service payments and a DRG-based payment system from the perspective of (a) the patient's insurer; (b) the hospital to which the patient was admitted; (c) the patient's admitting physician; and (d) the patient. Less than 100 wor

Debate the use of lowest-cost combination of workers.

Lobo Lighting Corporation currently employs 100 unskilled laborers, 80 factory technicians, 30 skilled machinists, and 40 skilled electricians. Lobo feels that the marginal product of the last unskilled laborer is 400 lights per week, the marginal product of the last factory technician is 450 lights per week, the marginal produc

Economics: Demand and price, product elasticity, big ticket items

1. What would happen if prices were lowered when demand was inelastic is that this would make the product elastic and the demand would increase for it. A real-world example is that of computer. If it is at $399, but if it becomes higher than $899, people may stop buying it. Furthermore, if prices were raised, then the demand

Economics Questions

1.a) Does the following graph, show an increase in supply or an increase in quantity supplied? What factor(s) might cause this change? Please see attachment above title "DQ1 A.gif" b) Does the following graph, show an increase in supply or an increase in quantity supplied? What factor(s) might cause this change? Please

Human Capital

1. (Question 5.5-ish) Theodore is considering a 1-year training pro- gram, which charges $40,000 in tuition, to learn how to install airport-screening equipment. If he enrolls in the program, his op- portunity cost in forgone income is the $100,000 per year he can now earn. After completing the program, he is promised a job

Monetary conversion

Suppose the Indian rupee price of one British pound is 54.392 rupees for each pound. A hotel room in London costs 120 pounds, while a similar hotel room in New Delhi costs 6,500 Indian rupees. In which city is the hotel room cheaper, and by how much?

Fringe Benefits: President Decision Making

A president at a university wants to reduce expenditures on fringe benefits (while maintaining the quality of faculty and staff). The president appointed a task force, which consists of faculty and staff from departments throughout the university. The task force has been asked to design a new fringe benefit package. Does

Macroeconomic factors that influence the operations of the company

Describe, discuss, and analyze the four factors listed below: 1. Macroeconomic factors that influence the operations of the company 2. Microeconomic considerations relative to the company 3. Legal considerations relative to equipment leases and e-contracts 4. Employment and labor law influences as the company grows both dom

Marginal Rate of substitution

Answer the following questions based upon the information given below Q = K^(1/2)L^(1/2), WK = $20 WL = $5 1. What relative amounts of capital and labor will be employed to maximize output? a. equal amounts of capital and labor b. four times as much labor as capital c. twice as much capital as la

Cost analysis

You drive 5000 miles a year and buy gasoline at the price of $2/gal. Except for differences in annual costs, you are indifferent between driving a 10 year old Buick ($400/yr, 20 miles per gal) or a 10 year old Toyota ($800/yr, 50 miles per gal). (a) Which one do you choose to drive? (b) How does your decision change if

Cournot Duopoly - Reaction Functions

Starting with the reaction functions of duopolists A and B from Problem 4, find the Cournot solution algebraically. Given the reaction function of duopolist A, QA = (12-QB)/2 (1) and the reaction function of duopolist B, QB= (12-QA)/2 (2), find the Cournot solution , that is to find QA and QB by substituting (1) into (2).

Pricing Strategy

A market has only two sellers. They are both trying to decide on a pricing strategy. If both firms charge a high price, then each firm will experience a 5% increase in profits. If both firms charge a low price, then each firm will experience a 3% increase in profits. If Firm 1 charges a high price and Firm 2 charges a low price,

Statistical Quality Control

Small boxes of NurtraFlakes cereal are labeled "net weight 10 ounces." Each hour, random samples of size n = 4 are weighed to check process control Five hours of observations yielded the following: Weight Time Box 1 Box 2 Box 3 Box 4 9 a.m. 9.8 10.4 9.9