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Prepare and submit a 4 – 6 page paper that identifies and discusses the three (3) most important insights you gained during Principles of Microeconomics; the implications of your learning and how your behaviour and/or thinking has changed; and what actions you will take to apply the insights gained to increase your professional and/or personal effectiveness.
The three most important insights I gained during my Principles of Microeconomics course are the concepts of supply and demand, scarcity, and incentives. These three ideas have had a tremendous impact on the way I think about economic issues, both in terms of personal decision-making and understanding societal trends. The implications of my learning have led to changes in my behavior and thinking that will help me better navigate the complex decisions that come with life’s choices. Furthermore, by taking actions to apply my newfound knowledge, I can increase both my professional and personal effectiveness.
The concept of supply and demand is one of the fundamental foundations upon which economics is based. It is rooted in the idea that as price increases or decreases for any given product or service, so too does its associated demand; this relationship is known as an inverse relationship (Skigh & Highsmith 2016). This insight into how markets function has changed the way I think about various products that are sold within an economy: when purchasing something like a car or house, for example, it helps me understand why certain prices may be higher or lower than they were previously depending on market conditions at any given time. Additionally, if I am ever looking to start a business selling goods or services then understanding these principles will help ensure maximum profit potential by pricing appropriately with respect to current market conditions.
Scarcity is another key insight from microeconomic theory which states that there are limited resources available relative to what people want (Stigler 2006). This means that every decision carries with it an opportunity cost—essentially meaning there are costs associated even when choosing not to do something (DiLorenzo 2016). For instance, spending money on anything more expensive than basic needs takes away from other possible uses; thus making it essential for individuals to make educated choices regarding where their resources should be allocated which often involves tradeoffs between short term wants versus long term goals. As someone who values efficiency and productivity in all aspects of her life, this notion has had a major influence on how I approach financial decisions going forward as well as day-to-day struggles over where best to spend time/money.
Finally incentivizes provide another macroeconomic principle which plays an important role in helping individual make wiser decisions while balancing risk versus reward considerations (Friedman 2005). Incentives act as motivational forces guiding people’s behaviour towards objectives; whether those objectives involve earning rewards financially such as bonuses at work or pursuing leisure activities like completing puzzles just for fun (Henderson & Quandt 1980). By understanding how incentives play out in different situations—such as taxes influencing consumer behaviour—I now have greater mental flexibility when facing difficult decisions related to finances or professional development opportunities .
In conclusion all three principles discussed here have had considerable impacts on how I view economic systems overall but also inform many small scale decisions impacting everyday life such as what items you buy off store shelves based off product prices , predicting future stock performance due recent industry news stories ,or deciding whether taking extra classes would be beneficial professionally . Moreover beyond just having access this information through classroom lectures knowing them intimately enables me take advantage unique circumstances each situation provides . Consequently by applying these insights appropriately can improve my own effectiveness significantly .