How People Make Economic Decisions Paper
How people make economic decisions regarding their buying’s of good or services at the market are ruled by three basic principles as follows: People are rational as they make the best decision that will benefit each individual on their purchases or selling’s. The people evaluate constantly the benefits versus the cost of the goods or services. Example of this might be:
An imaginary famous nail enamel branch was priced originally as .39 cents as the sale manager established. The famous branch was heading to bankrupt then did a marketing study of the market where they establish that the price the people where most likely to pay was .69 cents; this ...view middle of the document...
The marginal benefits and marginal costs associated with the decisions of buying a used car with a good history of service and a reasonable mileage could be in its low cost versus the total payment of a new car for six years. Even if the used car had issues with the engine on the long
run this type of fixes could be around the 3k but in comparison in the long run you could be
saving a lot of money. A different decision could be make if the government offer an incentive as
the one offered right now to buy the new Nissan leaf that would save cost at the end and give you
better mileage than the average gasoline cars. The principles of economics relate to decision
making, interaction, and the workings of the economy as a whole would depend greatly on the
consumers and the government since the companies at the end would produce whatever the
buyers are willing to buy and at the economic level as the majority of the population being
Each country has a type of economy marked some of them could be: market economy, centrally planned economy, and mixed economy system. These types of economies relates to type of government policies as an example the market economy is run mostly by private organizations that produce goods and services, where the consumers “us” at the end select what we would by; For the other hand we have the centrally planned economy wish is utilize by some socialist country as China and Cuba, where all goods are highly controlled by the government. In this 21st century we count with a new type of economy called mixed economy...