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Chapter 1. About Economics. Figure 1.1. Result of the Exxon Valdez Oil Spill.
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Chapter 1 About Economics
Figure 1.1. Result of the Exxon Valdez Oil Spill The Exxon Valdez oil spill in 1989 dumped 11 million gallons of oil into Prince William Sound. As this photo shows, much of the oil was carried to shore. Economists were asked to measure in dollars how much people value cleaning up the sound. Image courtesy of Office of Response and Restoration, National Ocean Service, National Oceanic and Atmospheric Administration.
Figure 1.2 The Three I’s of Economic Theory : Incentives, Interactions and Indifference
Figure 1.3. Wren is indifferent between farming and industry labor
Figure 1.4. With the government subsidy, Wren prefers being a farmer
Figure 1.5. The government subsidy raises land rent, leaving Wren indifferent once again.
Figure 1.6. Price differences for wheat in selected Midwest states. All differences are relative to river ports in Eastern Kansas and Oklahoma ( a negative difference means the price is lower relative to river ports). Map made available by Agmanager, Department of Agricultural Economics at Kansas State University. Available at http://www.agmanager.info. Accessed September 20, 2005.
Figure 1.7. Meet Tim Cassidy Tim Cassidy, a native of Wyoming, graduated with a bachelor’s degree in Agricultural Economics from Oklahoma State University in 2005. Soon after graduation he went to work for the Archer Daniels Midland (ADM) Company as a commodity trader. Tim earns his salary by arbitraging for ADM. Each day at work, Tim scouts the differences in soybean, corn, wheat, and soybean meal prices across regions, and if profit opportunities present themself, he places orders to buy or sell thousands of dollars of a commodity. Not every arbitrage will make money, but if one understands market forces, significant profits can be made over time. “Within weeks of my first job out of college I was managing thousands of dollars of soybeans at one time. At first I was overwhelmed with the responsibility, but by holding fast to the principles I learned in agricultural economics, I have learned to do my job well and have a lot of fun in the process!” --Tim Cassidy A Word from ADM Archer Daniels Midland Company, an industry leader in agricultural processing and fermentation technology, recruits qualified candidates for internship and entry-level positions. Our internships are designed to give students meaningful work experience and business exposure through a global leader in the agricultural industry. We actively recruit for positions in the following areas: Accounting, Commodity Trading/Elevator Management, Engineering, Grain Terminal Operations Management, Internal Audit, Information Technology and Specialty Areas (i.e., Finance, Marketing, R&D, Human Resources). To learn more about opportunities at ADM, please visit us at http://www.admworld.com under Careers.
Figure 1.9. A Few Words From the Father of Economics Image made available by the Adam Smith Institute. Available at http://www.adamsmith.org/.
Figure 1.10. Change in Calories Per Day Consumed for U.S. Males A Shows the percent of increase in total calorie consumption due to each factor. Source: Cutler, Gleaser, and Shapiro.
