Decision Making Essay

1322 Words Dec 22nd, 2010 6 Pages
Chapter 2
Once again, I was amazed at how much I remember from my last economics class. Scarcity exists because we have unlimited wants but only limited resources available to fulfill those wants.
Production possibilities frontier is the curve showing the maximum attainable combinations of the two products that may be produced with available resources and current technology. Companies need to decide what trade-offs they face. With the maximum output possibilities being obtained from the available resources.

When making decisions on what to produce or not, companies need to determine their opportunity costs, which is the highest valued alternative that must be given up to engage in a certain activity. You can only make certain
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Households supply labor, entrepreneurial ability, and other factors of production to firms. In factor markets, households receive wages and other payments from firms in exchange for supplying the factors of production.

Free markets that have few government restrictions on how goods or services can be produced or sold is good in the United States. Other countries have rejected this for centrally planned economies where firms are told what they can produce and who receives the benefits of these products. As Americans we should be grateful for the free markets that are available to us.

The "Making the Connection" article about YouTube, Myspace, and Facebook was interesting to me as well. With having young adults at home I am familiar with these sites. I can understand where individuals or firms are upset about the unauthorized copying of materials and copyright issues. This is where people also need to remember their ethics because you shouldn't infringe on the rights of others. I am always trying to encourage my children to use discretion when posting anything on these sites and to not infringe on others rights.
Chapter 3
Chapter three starts off discussing Red Bull and the market for energy drinks. I thought this was a good opener because it talked about it being a perfectly competitive market. This meant there are many buyers and sellers and the products are mostly the same. There are

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