Jane talks about economics in life

When it comes to economics, many people will find it abstruse and boring, but this is not the case. In fact, just as economists can tell the degree of economic prosperity by the length of girls' skirts on the street, many things in life are another scenery from the perspective of economics.

what is economics? There are various answers to the definition of this concept. For example, economics discusses what goods to produce, how to produce them and for whom. In his masterpiece Economics, Samuelson wrote: "Economics studies how society uses scarce resources to produce valuable goods and distributes them among different people." From the perspective of fairness and efficiency, production and distribution, the book Management Economics points out that "economics is a social science that studies how to allocate economic resources effectively and how to distribute national wealth fairly to meet personal or social goals." To sum up, all kinds of arguments can not be separated from the thinking that economics is to make limited resources be used in the most reasonable ways in order to increase the total wealth of society and make society more and more affluent.

this understanding of economics has three meanings: first, the purpose or desire of individuals or society is endless, while economic resources are limited and scarce in absolute terms. Due to the rapid increase of population, the adjustment and development of industry and agriculture, and the increasingly serious pollution, renewable resources such as forests and groundwater and non-renewable resources such as minerals are increasingly scarce, and even the air and river water that were once considered inexhaustible are becoming scarce due to pollution. Second, although scarce resources have various uses, once they are used for one purpose, they cannot be used for other purposes. Therefore, people's economic activities all involve the issue of choice. Here, efficiency means that a country's economy should organize its production and consumption units so that the society can get the maximum number of needed goods and services, and within the scope of current customs, laws and systems, economic resources should be fully utilized. Third, under the goal of maximizing social welfare, we can seek a fair distribution scheme through systems such as "equal opportunities" or "equal results". Under the market economy conditions, through the fair rules of the game of equal opportunities, the prosperity brought by competition will be realized.

and "economics in life" is to analyze slightly abstract economics and some seemingly ordinary phenomena in our lives from the perspective of economics. With economic construction as the core goal in China at present, economics has been everywhere in our lives: analyzing and investing in stocks, calculating the price-performance ratio before buying a house, and even discounting the shopping malls that women are keen on. But most people haven't thought about it carefully, why the stock market is falling, the house price will be high and low, and why the shopping malls should be discounted. These are the purposes of studying "Economics in Life": to look at the phenomena in life from the perspective of economics, to weigh the pros and cons more scientifically, and to help us make better judgments.

Take these examples for example:

Why does milk always come in a square box while coke comes in a round bottle?

this is economics in product design.

one of the reasons may be that most soft drinks are drunk directly in the container, so the cylindrical container is more hand-weighing, which offsets the extra storage cost it brings. This is not the case with milk. Most people don't drink milk directly from the box. Moreover, even if most people drink milk directly from the box, the "cost-effectiveness principle" shows that they are still unlikely to be sold in cylindrical containers. It is true that square containers can save shelf space, but the space saved in the case of milk is obviously more cost-effective than that in the case of soft drinks. Because most soft drinks in supermarkets are placed on open shelves, which are cheap and usually have no operating costs, milk needs to be specially packed in freezers, which are expensive and expensive to operate. Therefore, the storage space in the freezer is very valuable, which improves the income of milk in square containers.

The explanation of this problem seems a little outdated, but the economic principle that "product design should consider cost and benefit" is still very useful in many places now.

There's another question I once saw about coffee refills at McDonald's.

Most enterprises have to sell many kinds of goods. In order to maintain business, enterprises don't need to charge more than their cost for each item. On the contrary, it only needs to make the total income equal to or exceed the total cost of the goods sold. Therefore, if the set meal, dessert and other items already contain enough profit margin, the restaurant < P > can of course provide free refill service without losing money.

why did that restaurant think of offering free refills? Because of competition. In the restaurant industry, with the increase of the number of customers, the average cost of providing services to customers will decrease, and because the fees charged by restaurants for each meal must be higher than the marginal cost of the meal (marginal cost is the variable cost of workers' wages, raw materials and fuel required to increase a unit output at any output level), so as long as they can attract additional customers, the profits of restaurants will increase.

there are many similar examples, so I won't list them here.

The teacher always puts some slides before each class, which contains many things about philosophy. After studying economics in life, I always feel that there is some unclear relationship between economics and philosophy (completely personal feeling), but the materials I read on the Internet have not mentioned this, perhaps I am oversensitive.

One more thing, see Frank said, "When an economic activity happens, people always rely on the wrong information to make decisions, and sometimes they will draw wrong conclusions from the right information. Because of the influence of this psychological phenomenon, economic behavior will change accordingly. " After studying this course, we hope to analyze the known information as correctly as possible and make the best judgment.

In a word, the course "Economics in Life" has taught me to analyze life cases with simple economic principles, which will be of great help to our future foothold in this economic society.