Our Leaders Can’t Pass Economics 101

Ever wonder how the people who want to lead our country would fair in a college economics 101 class? Well The College Investor has broken it down for us. They state that the average 101 class covers

• Interactions between consumers (you and I) and producers (factories) that determine pricing and the distribution of outputs (which includes goods and the wages paid
• This is Supply and Demand 101.  People pay more for scarce goods, and less for abundant goods.  Suppliers determine their pricing based on this.  Wages are similar – more workers for a job means lower wages.  Have a special skill, you will probably make more.
• How gains from specialization and exchange (i.e. trade), whether domestic or internationally, exceeds any losses by significant amounts
• This is all about trade.  Basically, free trade is good for the entire population.  Not to say that specific individuals or groups won’t be harmed in the short run, but over the long term, specialization and trade will be beneficial as the price of goods will come down.
• How the decisions by consumers, producers, and the government determine domestic and global prosperity
• This highlights the impacts of taxes and tariffs on the prices of goods.  The idea is that the higher the price, the less consumers will buy it.  So, you can artificially inflate a price by taxing it.  You can make trade less favorable by putting up tariffs.  Tariffs are designed to protect the home industries that could be harmed by trade, but they do cause higher prices for others.
• How efficiently or equitably economic issues are resolved through markets or government policies (i.e. which is better, the market, government policies, or a combination of both – based on specific issues like fisheries, global warming, etc.)

Where do our future leaders fail? Check out the original post below:

http://THECOLLEGEINVESTOR.COM/1855/our-leaders-cant-pass-economics-101/