Study Guide for Economic Problems
Chapter 3: The open access(Fisheries) and public goods problem (Demand
Natural Capital- Sources and Sinks cannot be privately owned= Creates too much pollution.
Open Access- If people weigh private benefits agains
Chapters 1-5 Keys Terms
Chapter 1: Economic questions about global warming
How much pollution is too much?
Is government up to the job?
How can we do better?
Can we resolve global issues?
Panther ID: 5858576
ECP 3302: INTRODUCTION TO ENVIRONMENTAL ECONOMICS
Write down your name and panther id and submit your answers in the Blackboard Drop Box as a
word document by the due date.
Application 1: Open Access
Reason for market failure
1 Presence of external costs -> pollution (producer's view point)
2 Open access
3 Public goods
QM > Q*
PM < P*
The degree to which the environmental regulation will affect market price and quantity and consumer
and producer surpl
Chapter 3 -> Microeconomics
About two things Demand and supply
Law of Demand
Quantity and price of the good
Its an inverse relationship between the two variables
Law of supply
Quantity of supply and the price of that good
Life history: the schedule of an organisms growth, development, reproduction, and survival;
represents an allocation of limited time and resources to achieve maximum reproductive
Fecundity: # of offspring produced by an organism per reproductive
Consider the Dixit model. In the first period firm 1 chooses its capital investment (capacity) K1. In the
second period firm 2 observes K1 and makes its own investment K2 and they compute in quantities. Let
qi denote firm i output. The market
ECP 4403: Industrial Organization
Autumn 2014, FIU
Exam 3 - Key
Print your name:_
Answer all the questions below. No need to show work. (However, partial credit is considered
only if work is shown.) Answers in fractions are accepted.
Part 1. Use the follo
exercises in collusion and merger
1. Four firms complete in the market where demand is P = 260-2Q, Each has marginal cost of 20.
a. compute the Nash equilibrium industry output and price per period.
b. compute the output per period if they collude to act
ECP 3302- TERM PAPER
(a) Financial benefit cost analysis
Annual fixed costs
Annual operating cost
Savings from gas consumption
Improved air quality
Travel time sav
ECP 3302 Introduction to Environmental Economics
Film Review assignment
The documentary, Poisoned Waters is a vivid description of most of the concepts and issues been
treated and addressed under the subject, economic environment.
Using the Chesapeake Bay
ECP 3302 Introduction to Environmental Economics
Extra credit assignment
The movie, Erin Brockovich is a real life story that happened in 1993. Erins exhaustive
investigation uncovered that Pacific Gas & Electric had been poisoning the small town of
THE VERTICAL BOUNDARIES OF THE FIRM
Main question: which activities will the firm carry out itself and which will be outsourced?
Vertical chain: process that begins with the acquisition of raw materials and ends with the distribution
THE HORIZONTAL BOUNDARIES OF THE FIRM
Economies of Scale: the production process for a specific good or service exhibits economies of scale over
a range of output when average cost declines over that range. (I.e. when increases in output lead to a
STRATEGY AND STRUCTURE
Organisational structure: arrangements (formal & informal) by which a firm divides up its critical tasks,
specifies how its managers and employees make decisions, and establishes routines and information
flows to support continuing
Sustainable Competitive Advantage
Focus: Sustainable competitive advantage and isolating mechanisms
Sustainable Competitive Advantage:
Competitive advantage vs. Sustainable competitive advantage
- Competitive advantage can be eroded by rivals through imit
The Origins of Competitive Advantage
Focus: Competitive advantage innovation and the evolution of the firm.
Acquiring competitive advantage think about:
Anticipating unmet and unarticulated consumer needs somewhere in the future
Invest in the develop
Strategic Positioning For Competitive Advantage
Focus: Competitive advantage, positioning, organisation & strategy and value creation
Strategic Positioning a firms ability to create value and enjoy a competitive advantage over other
firms depends on how i
PERFORMANCE MEASUREMENT AND INCENTIVES
A crucial issue for all firms is:
Measuring the performance of employees
Making sure that employees perform actions in the interest of the firm.
Problematic due to Agency Problems
COMPETITORS AND COMPETITION
The success of a firms organisation & strategy depends on the characteristics of:
Definition if one firms strategic choice (adversely) affects the performance of another firm.
ALTERNATIVES FOR MAKE-OR-BUY DECISIONS
Technical vs. Agency efficiency
Technical efficiency: achieved when a certain activity is performed using the least-cost production
Agency efficiency: achieved when organisation of activity minimises coordin
Dynamics: Competing Across Time Strategic Commitment
There should an explicit distinction between different strategies:
Tactical decisions vs. strategic commitment
Short term effects
Easy to reverse
E.g. price changes of a product
ENTRY AND EXIT
Entry the beginning of production and sales by a new firm in a market
There are two forms of entry:
By a brand new firm
By an established firm that is diversifying into a new market
Effect of entry on the market:
The market shares of incumb
EXTERNAL CONTEXT AND STRATEGY
Focus: Social Context & Firm Strategy
Social Context firms act within networks of already established relationships.
Relationships are often based on shared customs, language, norms, or rules.
Social context can reduce transa
Poisoned Waters Film Review
Over 35 years ago, Congress passed a safety standard legislation now recognized
as the Clean Water Act. The Clean Water Act set restrictions on the amount of pollutants
Chapter 3- Homework
1. Husbands and Wives benefit from specialization and exchange because it helps increase
the couple total income. By John devoting his time to the market, which he specializes in,
and Jane putting more hours into cook
Chapter 4 1/30/2013
1. Men labor force participation decreased between 1940 and 1945, due to men leaving their
civilian jobs to join the armed forces. On the other hand, men are more likely to have a
blue- collar job and in durable manuf
1. Scarcity is when there are not enough resources available for everyones wants and needs,
so we will have to make choices on usage of items. Scarcity is central to neoclassical
economics because neoclassical is the decisions