This module is designed to Convey the scope of microeconomic theory. Explain why theory, is essential to understanding and predicting real- world outcomes. Distinguish between positive and normative analyses. Differentiate between real and nominal prices. Describe the basic assumptions economists make about market participants. Introduce the concept of opportunity cost and explain how economic costs differ from accounting costs. Show how a production possibility frontier graphically depicts the basic assumptions economists make about market actors as well as the concept of opportunity cost.
3. Assessment
Direction: Answer the following questions and send your answers to my email. The subject title of your email should be - Microeconomics Module 1 Assessment- also your answer should follow this format Arial 12 and single spacing.
1 Say that the citizens of Tucson, Arizona, vote to increase the minimum wage within the city to $10 per hour above the prevailing federal minimum wage of $7.25. Explain how one would use positive and normative analysis to evaluate the desirability of this proposed policy.
2 What economic forces might explain why the relative price of telephone services fell while the relative price of medical care increased between 1983 and 2013?
3 Explain why it is important to look at a good's real price as opposed to its nominal, or absolute, price.