Economic Value Per Unit Of Raw Material example essay topic

Economics Presidents, cabinet members, congressmen, senators, TV pundits, editorial writers, leaders of business and labor, and taxpayers talk about the American economy. That is natural and good. Much of our lives center on the economy. A great deal of this talk, though, proceeds in ignorance of basic facts about the American economy or, what is worse, makes assumptions about it that are not so, or at least are highly doubtful. By basic facts I mean those that refer to the condition of the country as a whole, that affect and interest large number of people, and that throw some light on the subjects of most widespread concern. Economics is the study of our behavior in producing, distributing, and consuming material goods and services in a world of scarce resources.

Economics is concerned with the efficient use or management of limited productive resources to achieve maximum satisfaction of human material wants. Current state of American economy is characterized by astonishing levels of productivity and profit of business firms, which have helped to provide greater affluence and a higher standard of living for a larger percentage of the population in the United States than has ever been the case in any other large society. No single factor is responsible for the success of American business. The geographical size, bountiful resources and population trends have all contributed to these successes.

Religious, social and political traditions; the institutional structures of government and business, and the courage, hard work and determination of countless entrepreneurs and workers have also played a part. With the fourth largest area and population of the world, the United States benefits greatly from the size of its internal market. The Constitution of the United States bars all kinds of internal tariffs, so manufacturers do not have to worry about tariff barriers when shipping goods from one part of the country to another. A population of more than 250 million people provide both workers and consumers for American businesses. Thanks to several waves of immigration, the United States gained population rapidly throughout the 19th and early 20th centuries, when business and industry were expanding. Population grew fast enough to supply a steady stream of workers, but not so fast as to overwhelm the capacity of the economy.

As we grew rapidly and almost chaotically into a manufacturing nation, population increased and concentrated in cities. Today people dress better, eat better, work fewer hours, and live more comfortably, that shows an overall development and progress of our country. Economic growth occurs whenever people take resources and rearrange them in ways that are most valuable. The example from the kitchen may be useful for production in an economy.

To produce a valuable final product, we mix inexpensive ingredients together according to a recipe. The cooking is limited by the supply of ingredients, and most cooking in the economy produces undesirable side effects. If economic growth could be achieved only by doing more and more of the same kind of cooking, we would run out of raw materials and suffer from unacceptable levels of pollution and nuisance. The economic growth springs from better recipes, not just from more cooking. New recipes generally produced fewer unpleasant side effects and generate more economic value per unit of raw material. Economics is described by two facts that may be called economic problems.

The first one is wants of the society, that are unlimited, and the second one is that resources scarce. Unlimited wants are those goods and services that have a utility that can satisfy a consumer. And economic resources are those resources that we use in producing goods and services. There are few types of resources: land, capital, labor, and entrepreneurship. So the main objective of economics is to find ways to best satisfy wants and needs of consumer and to spend resources effectively. Total output and output per capita are the best single measures of the performance of the economy.

The total output of a country limits how much its population can consume, how much they can devote to investment to increase consumption in the future, and how much they can devote to defense of the country. The American people today enjoy much higher levels of consumption that they did in earlier generations because per capita output is much greater than it was.