Memo
To: My Business Partner
From: [Insert your name]
Date: [Insert date]
Re: Microeconomics Simulations
Introduction
This memorandum report identifies
and explains key microeconomic principles using a set of simulation games. The
outcome of these games illustrate how microeconomic principles can be applied
within real-life situations to help us make better business decisions. This
report is a summary of the simulations I played and their results, which
include the key takeaways and their significance, for your review and
reference. It is divided into the following sections:
Comparative
Advantage
Competitive
Markets and Externalities
Production,
Entry, and Exit
Market Structures (including the Price Discrimination and Cournot simulations)
Conclusions
References
Comparative Advantage
[Replace this area with the Comparative
Advantage Simulation Results.]
Figure 1.1
[Insert your responses to the
following questions: How does this simulation demonstrate how individuals
evaluate opportunity costs to make business decisions? Explain what role the
production-possibility frontier (PPF) has in the decision-making process.]
[Explain how comparative advantage
impacts a firms decision to engage in trade. Would a businesss decision to
trade cause a change to its PPF? Provide specific reasoning to support your
claims.]
Competitive Markets and Externalities
[Replace this area with the Competitive Markets Simulation Results.]
Figure 2.1
[Replace this area with the Externalities (with Policy Intervention)
Simulation Results.]
Figure 2.2
[Insert your responses to the following questions: What
impact do policy interventions have on the supply and demand equilibrium for a
product? Provide specific examples from the simulation to illustrate.]
[What are the determinants of price
elasticity of demand? Identify at least three examples. Based on the outcome of
the simulation, explain how price elasticity can impact pricing decisions and
total revenue of the firm.]
[Based on the results of the
simulation, can policy market interventions cause a change in consumer or
producer surplus? Explain why using specific reasoning.]
Production, Entry, and Exit
[Replace this area with the Production
Entry and Exit Simulation Results.]
Figure 3.1
[Insert your responses to the following questions: Analyze
a business owners decision making regarding whether to enter a market. For
example, what factors determined the drivers entry and exit into the market in
the simulation? Use economic models to support your analysis.]
[How does a business owner apply the
concept of marginal costs to decide how much to produce? For example, how did
the driver determine how many hours to drive each day? Use economic models to
explain.]
[How does the impact of fixed costs
change production decisions in the short run and in the long run? Use the
average-total-cost (ATC) model included in the textbook to demonstrate this
impact.]
Market Structures
[Complete the table by selecting the appropriate
response from the drop-down select menu within each cell, except for the final
column in which you will enter your text-based response.]
Market Structure
Number of Firms
Type of Product Sold
Price Taker?
Price Formula
Freedom of Entry?
Short-run Profit?
Long-run Profit?
Industry Examples
Perfect Competition
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[Insert two
to three example industries that meet the criteria of the market structure.]
Monopolistic Competition
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an item.
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an item.
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an item.
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an item.
[Insert two
to three example industries that meet the criteria of the market structure.]
Monopolies
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an item.
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an item.
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an item.
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an item.
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an item.
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an item.
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an item.
[Insert two
to three example industries that meet the criteria of the market structure.]
Oligopolies
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an item.
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an item.
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an item.
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an item.
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an item.
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an item.
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an item.
[Insert two
to three example industries that meet the criteria of the market structure.]
Table
4.1
[Insert your responses to the following questions:
Explain what market inefficiencies derive from monopolies and monopolistic
competition. Use examples from the textbook to support your claims.]
[How do firms in an oligopolistic
market set their prices? Use examples from the textbook to support your claims.]
[Explain how firms that compete in
the four different market structures determine profitability. Use examples from
the textbook to support your claims.]
Conclusions
[Insert your overall conclusions about the relevance
and significance of microeconomics. How will microeconomics principles impact
your business decisions moving forward? Provide recommendations to your
business partner for your future business venture.]
References
Mankiw, N. G. (2021). Principles of microeconomics (#9 edition). Cengage.
[Add other citations, as needed, in APA format].
