Reflection

This class has been helped me learn more about key aspects of the economy. Key factors like supply and demand, utility, marginal costs/benefits, opportunity costs, and much more. I plan on starting my own business some day and this class opened my eyes to a lot of what needs to be considered when doing so. Since day one when I learned what opportunity cost was I have been evaluating the opportunity cost of me going out to lunch versus going home for lunch during my work day. I realize that often the opportunity cost of giving up $7 dollars for lunch is worth it if I can get back to work twice as fast as I would if I were to go home for a free lunch. Analyzing articles and writing about them using the term we have learned in class has proven to me that much of this new vocab can easily be worked into daily conversation. Overall this class has been great I do however feel like we covered twice as much material in the second half of the semester than in the first half which has made it harder to remember the new information.

 

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Monopoly Article

Mckay Buehner                                               Monopolies and Oligopolies                                          Article 7

Summary:

This article was written by Tim Wu, a professor at Colombia Law School, is an expert on monopolies (the only supplier of a unique product with no close substitutes) and oligopolies (a firm that produces a product for which there are only a few rival firms that produce a close substitute). In the article Tim focuses on some of the major monopolies of our time and points out how they evolved and how some last longer than others. Google, Facebook, ebay, and AT&T are some of the companies Tim uses as examples of monopolies and oligopolies.

Analysis:

Wu does a good job of pointing out that these internet oligopolies are now becoming essentials in our lives, or at least that’s the way we see them. These internet based firms (any organization that purchases factors of production) are not price takers (firms that cannot control the price of the good they sell), but price setters. Companies like Facebook and Google make the majority of their revenue, not from selling their internet services but, by hosting advertisements for other companies. Entrepreneurship (a special kind of labor/human resource= creative labor) and technology (the practical application of scientific knowledge) have been the backbones of these companies.

There are pros and cons to have oligopolies and monopolies dominating our society. Many people only see the negative aspects like the ability to control prices. While there are negative aspects of these types of firm there are some positive aspects as well that you don’t see in a perfect competition firm (a firm whose output is so small it has no impact on price). An example of a pro would be the research and development that can be attained through the resources of a monopoly. In the long run (a time period longer than a year in which firms can vary all factors of input) monopolies can make tremendous amounts of money because they gain control of the market, however in most cases it takes a lot of time to become a monopoly. Hands down what has been the biggest achievement by these online based company has been their ability to maintain and even raise the utility (the amount of satisfaction, pleasure, or need fulfillment that an individual receives from consuming a good or service) their customers receive. The marginal rate of substitution (the rate at which and individual is willing to reduce consumption of one good when he/she gets one more unit of another good) goes right out the window cause there is no close substitute. 

 

 

In the Grip of the New Monopolists

How hard would it be to go a week without Google? Or, to up the ante, without Facebook, Amazon, Skype, Twitter, Apple, eBay and Google? It wouldn’t be impossible, but for even a moderate Internet user, it would be a real pain. Forgoing Google and Amazon is just inconvenient; forgoing Facebook or Twitter means giving up whole categories of activity. For most of us, avoiding the Internet’s dominant firms would be a lot harder than bypassing Starbucks, Wal-Mart or other companies that dominate some corner of what was once called the real world.

Apple Chief Executive Steve Jobs Getty Images

The Internet has long been held up as a model for what the free market is supposed to look like—competition in its purest form. So why does it look increasingly like a Monopoly board? Most of the major sectors today are controlled by one dominant company or an oligopoly. Google “owns” search; Facebook, social networking; eBay rules auctions; Apple dominates online content delivery; Amazon, retail; and so on.

There are digital Kashmirs, disputed territories that remain anyone’s game, like digital publishing. But the dominions of major firms have enjoyed surprisingly secure borders over the last five years, their core markets secure. Microsoft’s Bing, launched last year by a giant with $40 billion in cash on hand, has captured a mere 3.25% of query volume (Google retains 83%). Still, no one expects Google Buzz to seriously encroach on Facebook’s market, or, for that matter, Skype to take over from Twitter. Though the border incursions do keep dominant firms on their toes, they have largely foundered as business ventures.

Amazon Chief Executive Jeff Bezos Bloomberg News

The rise of the app (a dedicated program that runs on a mobile device or Facebook) may seem to challenge the neat sorting of functions among a handful of firms, but even this development is part of the larger trend. To stay alive, all apps must secure a place on a monopolist’s platform, thus strengthening the monopolist’s market dominance.

Today’s Internet borders will probably change eventually, especially as new markets appear. But it’s hard to avoid the conclusion that we are living in an age of large information monopolies. Could it be that the free market on the Internet actually tends toward monopolies? Could it even be that demand, of all things, is actually winnowing the online free market—that Americans, so diverse and individualistic, actually love these monopolies?

The history of American information firms suggests that the answer to both questions is “yes.” Over the long haul, competition has been the exception, monopoly the rule. Apart from brief periods of openness created by new inventions or antitrust breakups, every medium, starting with the telegraph, has eventually proved to be a case study in monopoly. In fact, many of those firms are still around, if not quite as powerful as they once were, including AT&T, Paramount and NBC.

Internet industries develop pretty much like any other industry that depends on a network: A single firm can dominate the market if the product becomes more valuable to each user as the number of users rises. Such networks have a natural tendency to grow, and that growth leads to dominance. That was the key to Western Union’s telegraph monopoly in the 19th century and to the telephone monopoly of its successor, AT&T. The Bell lines simply reached more people than anyone else’s, so ever more customers came to depend on them in a feedback loop of expanding market share. The more customers they reached, the more impervious the firm became to challengers.

Still, in a land where at least two mega-colas and two brands of diaper can duke it out indefinitely, why are there so many single-firm information markets? The explanation would seem to lie in the famous American preference for convenience. With networks, size brings convenience.

Facebook CEO Mark Zuckerberg Getty Images

Consider that, in the late 1990s, there were many competing search engines, like Lycos, AltaVista and Bigfoot. In the 2000s, there were many social networking sites, including Friendster. It was we, collectively, who made Google and Facebook dominant. The biggest sites were faster, better and easier to use than their competitors, and the benefits only grew as more users signed on. But all of those individually rational decisions to sign on to the same sites yielded a result that no one desires in principle—a world with fewer options.

Every time we follow the leader for ostensibly good reasons, the consequence is a narrowing of our choices. This is an important principle of information economics: Market power is rarely seized so much as it is surrendered up, and that surrender is born less of a deliberate decision than of going with the flow.

We wouldn’t fret over monopoly so much if it came with a term limit. If Facebook’s rule over social networking were somehow restricted to, say, 10 years—or better, ended the moment the firm lost its technical superiority—the very idea of monopoly might seem almost wholesome. The problem is that dominant firms are like congressional incumbents and African dictators: They rarely give up even when they are clearly past their prime. Facing decline, they do everything possible to stay in power. And that’s when the rest of us suffer.

AT&T’s near-absolute dominion over the telephone lasted from about 1914 until the 1984 breakup, all the while delaying the advent of lower prices and innovative technologies that new entrants would eventually bring. The Hollywood studios took effective control of American film in the 1930s, and even now, weakened versions of them remain in charge. Information monopolies can have very long half-lives.

Google co-founder Sergey Brin Bloomberg News

Declining information monopolists often find a lifeline of last resort in the form of Uncle Sam. The government has conferred its blessing on monopolies in information industries with unusual frequency. Sometimes this protection has yielded reciprocal benefits, with the owner of an information network offering the state something valuable in return, like warrantless wiretaps.

Essential to NBC, CBS and ABC’s long domination of broadcasting was the government’s protection of them first from FM radio (the networks were stuck on AM) and later from the cable TV industry, which it suppressed for decades. Today, Verizon and AT&T’s dominance of wireless phone service can be credited in part to de facto assistance from the U.S., and consequently their niche is probably the safest in the entire industry. Monopolies may be a natural development, but the most enduring ones are usually state-sponsored. All the more so since no one has ever conceived a better way of scotching competitors than to make them comply with complex federal regulation.

Info-monopolies tend to be good-to-great in the short term and bad-to-terrible in the long term. For a time, firms deliver great conveniences, powerful efficiencies and dazzling innovations. That’s why a young monopoly is often linked to a medium’s golden age. Today, a single search engine has made virtually everyone’s life simpler and easier, just as a single phone network did 100 years ago. Monopolies also generate enormous profits that can be reinvested into expansion, research and even public projects: AT&T wired America and invented the transistor; Google is scanning the world’s libraries.

The downside shows up later, as the monopolist ages and the will to innovate is replaced by mere will to power. In the 1930s, AT&T took the strangely Luddite measure of suppressing its own invention of magnetic recording, for fear it would deter use of the telephone. The costs of the monopoly are mostly borne by entrepreneurs and innovators. Over the long run, the consequences afflict the public in more subtle ways, as what were once highly dynamic parts of the economy begin to stagnate.

These negative effects are why people like Theodore Roosevelt, Louis Brandeis and Thurman Arnold regarded monopoly as an evil to be destroyed by the federal courts. They took a rather literal reading of the Sherman Act, which states, “Every person who shall monopolize…shall be deemed guilty of a felony.” But today we don’t have the heart to euthanize a healthy firm like Facebook just because it’s huge and happens to know more about us than the IRS.

The Internet is still relatively young, and we remain in the golden age of these monopolists. We can also take comfort from the fact that most of the Internet’s giants profess an awareness of their awesome powers and some sense of attendant duty to the public. Perhaps if we’re vigilant, we can prolong the benign phase of their rule. But let’s not pretend that we live in anything but an age of monopolies.

—Tim Wu is a professor at Columbia Law School. His new book is “The Master Switch: The Rise and Fall of Information Empires.”

http://online.wsj.com/news/articles/SB10001424052748704635704575604993311538482

 

Math 1050 Transportation Cost Project

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This was a great project that taught me how to apply math to my every day life. Sometimes we think that math is too hard to apply to our daily lives but this was actually quite simple. In this project we learned how to calculate fuel efficiency which is very important to anyone who drives. By learning the math behind fuel efficiency we can learn to save money, who doesn’t want to save money? Great project!

The idea behind the project was to teach us the principle of optimization of resources, in this case fuel was the example. This concept relates to be as human labor  is a resource that I deal with at work; learning how to optimize the time and effort of those that I oversee is key to being efficient. I also like to cook and I often have a minimal budget to work with so learning how to optimize my resources (ingredients) I can make more food and save money.

By graphing the function it helped us SEE the optimal potential, seeing makes it easier to recognize the benefits. I took a microeconomics class in the which we focused a lot on optimization, usually referring to production. We used similar graphs to provide a visual of what factors affect the reaching of the optimal place on the graph.

Again I really enjoyed this project because it seems to make more sense than most of the other projects I have previously done where the goal is to help us see how math can be applied to our daily lives. I plan on starting my own business some day and I know that I will be making graphs often in order to calculate how to get the most out of my resources.

2,200 miles in the Barney Booster

 

About 10 years ago my family and I drove all the way from Greensboro North Carolina to Salt Lake City Utah.  The trip carried us through about 8 different states and 2200 miles of great fun!  I don’t know if it’s obvious or not but the word “fun” may have been an exaggerated optimistic point of view.  We embarked on this journey in an early 1990’s purple Ford mini-van.  The reason we drove was because my parents had the goal of saving some money and they also wanted to give all the children the chance bond with each other. Boy did we bond! 

                        There was a total of 8 of us at the time, my parents, 5 boys and 1 girl, bless her heart. The purple mini-van we were driving was awarded the very fitting nickname, “The Barney Booster.”   This nickname was justified because it looked like Barney had fallen over and someone put wheels on it. It is always said that mini-vans are supposed to be compact on the outside but spacious on the inside, but let’s be honest with 8 of us and only 7 seats the term “spacious” was far from reality. I should clarify that it only had 7 seats when we bought it but once we wedged a cooler in between the middle seats it became an 8 seater.  My mom used the cooler to her advantage by making it the time out seat.

Up to this point I have described the driving conditions pretty well, but wait it gets better.  To save time we drove through the night. We drove 2200 miles, 36 hours strait without sleeping in a bed.  Our attempts to take naps in the car were not very successful. When you look at it in days, one night without a bed might not sound so bad but being in a very uncomfortable position for 36 hours you tend to long for a bed.  Being very determined, my parents would only stop to use the bathroom. One thing about my mom is that she is always prepared. She packed enough food to hold us over for the most part of the intense car ride even when eating seemed to be a frequent activity to pass the time. 

I feel like I am on an infomercial because I have to keep saying “but wait there’s more.”  A week prior to our trip my eldest brother and I were exposed to poison ivy to which we are highly allergic so we were both on medication that unfortunately had the side effect of frequent bathroom trips and a constant itch.  Sometimes while driving through the slow empty parts of our country we would just pull over on the freeway so that my brother and I could hop out and you know… One time while pulled over for a bathroom break another mini-van pulled over with the same idea and 5 girls hopped out. You can imagine how embarrassed we felt as those girls headed into the same group of trees we were in…

Most people after hearing this much of the story immediately say “you have crazy parents” and it’s true I do have crazy parents but in a good way.  Taking 6 children under the age of 13 across the country for a two week stay in Utah is definitely crazy. We were a little rowdy and rambunctious for the first portion of the car ride. The arguments were usually over what, at the time, seemed to be important. Things like who is taking up more space on the back seat and whose turn it was to play with the “Game boys.”  My mom is famous for the “reach around and snap.” This was when she would be driving and reaches back towards us and snaps her fingers as if that was going to stop us from arguing.

Part of the reason we had embarked on this journey was because my dad was really sick at the time with cancer and so we were headed to Salt Lake to see his family that lived there. This presented another obstacle because his left arm would go numb quite often, this made it hard for him to drive and that meant that my mom had to drive the majority of the way.  We have a family rule that is whenever we are in the car the driver gets to pick the music. When the distance you are traveling is not far-off then it doesn’t really matter what music the driver picks because it will only be on for a few minutes.  My mom had a CD that she made for the trip with the same 5 songs from the movie “A Walk to Remember” on there twice… we listened to it the whole way. We had those songs memorized to the point where we could not only sing along with the music but also sing them perfectly a cappella. Even now, 10 years later, every time we hear those songs we turn them up and sing along and think back on the long drive we once made.

After that long journey we were able to spend some good quality time with some of our relatives in Salt Lake City. To be honest I think I remember the car ride better than our stay in Utah.  Countless hours were spent playing the “Alphabet game” and “Slug Bug” during the drive. As for my parents I don’t know if the trip was a success in their eyes or just a disaster. All I can say is that the drive home was a little different; we stopped at a hotel.  My parents were happy to have made it that far so they decided to “spoil” us with a one night stay.

 

 

 

 

 

Reflection: This was an assignment for my english 2010 class at SLCC. We we asked to prepare a memoir and this was the story I chose to use. Writing this memoir was fun because its a genre that allows you to be creative. Although the story needs to sound true it doesnt necessarily need to be true. In my case the story I chose for my memoir is already entertaining so I didnt need to beef it up with exaggerations or false information. Once I learned that the purpose of a memoir is to relate an essential human experience, I was able to organize my story so that it fit that criteria. Overall it was a fun paper to write and rewrite and rewrite again.

2,200 miles in the Barney Booster About 10 years

Bowling 1 Reflection

1. From taking this general education class I learned that there is a lot more to bowling than meets the eye. I consider it a lifelong wellness activity because it is a sport that’s requires both mental and physical concentration. Lifelong wellness activities don’t necessarily need to be overly intense they just need to require you to move and think. That criteria of a lifetime wellness activity encompasses many different activities, bowling being one of them.

2. The way I would apply this information to my life is by making sure that I stay active all throughout my life. I plan on bowling competitively some day and when that day comes I will be able to use all that I learned in my bowling class. Bowling has been a great activity for me because it has taught me to use a strategy to improve each game.

3. I do intend to continue to bowl regularly. I will practice my spare shooting and my cross-laning. By continuing to bowl and work on specific aspects of the game I will stay healthy and happy.

4. I don’t have any suggestions for improving the class. I loved it. I learned a lot. Steve was a great professor. What else could I ask for?