Basics of Economics
Naked Economics:
Undressing the Dismal Science
( AP economics summer assignment )
Sora Kim
265543801
Mr. Kotzky
1a. “Individuals seek to maximize their own utility.” Explain this basic economic principle.
b. Discuss several of the conflicts / choices, as discussed by Wheelan, that individuals may face in trying to maximize their utility. Economists would basically do whatever it takes to gain privileges or derive utility. For example, they would pay taxes or get a doctor’s shot. Doing those things isn’t exactly pleasant, but you would do it for escaping future consequences if it’s not done. If you don’t pay your taxes, you go to prison; if you don’t get a doctor’s shot in time, you get ill. All economists have different tastes and preferences to obtain these utilities. Just because yours seem more interesting than the other guy next to you, doesn’t mean to go enforcing it to someone else. Their lives may be completely the opposite than yours and might not fit their levels of preference. This act of enforcing preferences leads to behaving selfishly. Even though every economist in the world wants to maximize their utilities, it does not mean to act greedily. In fact, Oseola McCarty worked as a laundress her whole life, but 4 years before her death, she gave a hundred and fifty grand to the University of Southern Mississippi to help poor students in need of a scholarship. So basically, trying to maximize your utility means spending more risks, so in the end or future, it’s better for us. However, life is always a roller coaster; it has ups and downs, just like the future of your utility. There’s always a trade-off. You either risk it now or gain utilities after, or you use your utility now, and face the consequence later. If you harass your boss out of anger, you may feel relieved for a while but a couple of months later; you may see yourself in jail. If you save up money to buy the latest technology instead of purchasing the golf clubs you wanted,
Undressing the Dismal Science
( AP economics summer assignment )
Sora Kim
265543801
Mr. Kotzky
1a. “Individuals seek to maximize their own utility.” Explain this basic economic principle.
b. Discuss several of the conflicts / choices, as discussed by Wheelan, that individuals may face in trying to maximize their utility. Economists would basically do whatever it takes to gain privileges or derive utility. For example, they would pay taxes or get a doctor’s shot. Doing those things isn’t exactly pleasant, but you would do it for escaping future consequences if it’s not done. If you don’t pay your taxes, you go to prison; if you don’t get a doctor’s shot in time, you get ill. All economists have different tastes and preferences to obtain these utilities. Just because yours seem more interesting than the other guy next to you, doesn’t mean to go enforcing it to someone else. Their lives may be completely the opposite than yours and might not fit their levels of preference. This act of enforcing preferences leads to behaving selfishly. Even though every economist in the world wants to maximize their utilities, it does not mean to act greedily. In fact, Oseola McCarty worked as a laundress her whole life, but 4 years before her death, she gave a hundred and fifty grand to the University of Southern Mississippi to help poor students in need of a scholarship. So basically, trying to maximize your utility means spending more risks, so in the end or future, it’s better for us. However, life is always a roller coaster; it has ups and downs, just like the future of your utility. There’s always a trade-off. You either risk it now or gain utilities after, or you use your utility now, and face the consequence later. If you harass your boss out of anger, you may feel relieved for a while but a couple of months later; you may see yourself in jail. If you save up money to buy the latest technology instead of purchasing the golf clubs you wanted,