Topic 13: The Return of the Zeppelin

The Zeppelin and Airship ventures use the costumer’s preferences to cause their return. Furthermore, the rise in income of the people who wants to enjoy a new and fascinating ways of traveling up in the air and also enjoying the view contributes to the return of the airship companies. Those are the determinants of demand that influence the economic condition of the airship companies. The determinants of supply of technology have also helped the return of Zeppelins. The balloon is now filled with helium instead of hydrogen, less dangerous in many aspects in which secures the consumer's fear of the Hindenburg Accident occurring. The technology advancement has led to the success and prosperity of the newly released Zeppelin and the airship industry. The market of the Zeppelin is a monopolistic market because it is the only company in the US that runs the market. However, in the old times, the market is a oligopoly which small amount of companies are competing in the market. Change in all the things of tastes, income and amount of buyers can all make this market very successful. As people get tired of ordinary airliner, they would select a new, different way of travel, same as when their income rises, they would spend more money on activities. They have never done before rather than continuing those that they have done already.

Topic 12: Pizza for Pesos?

When the pizza company, Pizza Patron, decide to accept pesos as a payment, Mexicans are more willing to shop in their shops. Their marginal utility to spent on one more pizza from Pizza patron is high. Therefore, the total utility is high. Some Mexican-Americans or illegal Mexican-immigrants goes to visit their relatives in Mexico in the weekends. When they came back to US, they don’t know where to spend the Mexican Pesos. Because most of the shops in US only accept US dollars. Pizza Patron becomes their choice to spend money on. Mexicans prefer to spent money on the Pizza patrons. It is convenient for Mexicans to directly spent Peso instead of exchange it into US dollars.  

The company accepts peso but give the customers change in US dollars. If the exchange rate in US and Pesos gets higher, the pesos became less valuable than before. The company earned less money. If the rate gets lower, the Pesos became more valuable, then the company  could earn money. Furthermore, people are less willing to spend pesos if the exchange rate is high. They will probably lose money if they decide to spend pesos instead of US dollars. Their budget line to buy pizzas in Pesos shifts to the right. 

I think it is good for the Pizza Company to accepts Pesos. However, Americans think they don't have comparative advantage on producing the pizza. Therefore, they don't accept Pesos. Countries are protective of their industries. If the industries doesn't make them money, they are less willing to accept others to be in the same industry. 

Topic 11: Brand Names and Utility

Some brand names have good effect on people because they are famous. People believe those famous brands are good and it shows a good satisfaction. People are willing to buy those things. For example, tons of people buy food from McDonald. They sometimes don’t trust the brand names that are not famous. For example, people in Taiwan won’t buy things from some random Chinese brand. Furthermore, some Chinese brands blend in unhealthy things in their products. They want to lower their cost, but it is not good for human body. For example, a Chinese brand blend in melamine that is a kind of toxin into infant formulas. I sometimes are unwilling to trust the brands that are not famous because I doubt those things would hurt my body.  

I believe a famous brand brings me more utility. For example, I often buy shoes from Nike or Adidas.  They have established themselves for many years. People believe the quality and durability they produce is fair and good. Sometimes, a product of famous brands brings people proud. It helps them to show off. For example, some rich people brings Louis Vuitton or Armani wallets to show off how rich they are. The products from Apple make me fascinated, too. They have good features that attracts me to buy their products. However, I will think before if I want to buy things from random vendors in markets of Taiwan.    

Topic 10: Consumer Preference and Utility - Skechers

The Skechers determined the needs of their target group by assessing feedback from them. It’s basic target group is the group of ages 12-24 and some of the people in the older who like youthful looks. Some of the them wear shoes in deserts, mountains or urban areas. They send feedbacks of its preference to Skechers and Skechers produces the products that fit the consumer’s preference in order to get the maximum profit. The Skechers largely use media to advertise their products. Their target groups of youths often touch media, so media is a good medium to advertise their products. There are advertisements of Skechers on pages in magazines or advertisement periods of TV shows. The Skechers constantly change their products. They change from sports shoes, sandals to boots. The fashion is changing while time proceeds. The preference of their target groups keeps changing through time and triggered Skechers to innovate new products. In that way, they are different from other shoe companies that only produce one kind of shoes.      

The place where young people would go to, for example, the Time Square, is a location that Skechers would tried to consider as their target market. Furthermore, those places are normally where people would converge. I think Skechers strategies are effecitive. I would be intrigued by the different features and variety of Skechers‘ products. The variety Skechers show is a good reason for consumers to buy their products. The sandals let feel a high level of utility because it could be use in many places. My feet will be free to kiss the air while I wear sandals. I don't think the popularity of boots is reasonable. The boots restricted the foot and make people hard to walk. I think when people walk with boots, they are like zombies.      

Topic 9: THe myth of Outsourcing Effect

Products are sent to countries that have comparative advantage on producing that product. The entire process is called as the globalization. The process of outsourcing is when companies find countries that has the comparative advantage and move their production line to there. For example, China has a comparative advantage on labor, so many companies move their production line there. Because they want to lower the cost. An open economy is when trade is not interrupted or intervened by government forces. People could actually do what they could do regardless of the government. 

In outsourcing, people lost their job because people that are 1000 miles replace them. However, it could also lower the cost of companies that could use the money saved to enhance production and efficiency. Many labors in China don’t receive proper education while people in US receive proper production. Those money could be implemented in to research and development. According to some research, Chinese labor received less than one US dollar per hour. At the same time, US‘ minimum wage per hour in many states is 7.25$. Companies move their production line to China could lower their cost tremendously. The opportunity cost of using the production line in US exceeds the opportunity cost of using the production line in China. The level of US and China and labor is a big difference. It is better to let the outsourcing happen. Companies could use outsourcing to reach the maximum benefit.         

Topic 8: Debate on Globalization

China didn’t have a strong economy before globalization. They were considered as LEDCs. After the globalization took effect in China, some big companies entered those two countries. They found out that China has big amount of people and using them as labor is very cheap. Therefore, they entered China in order to lower their cost in labor. China’s economy grew tremendously afterwards. India had their economic grew as the same way as that of China. Those two countries both have comparative advantage on cheap labor. Their economic trend was almost the same during those years.   

In the globalization, countries trade with each other to earn money. They no longer trade within the country. They expand their vision in to the entire world and earn tons money. With those money, some people in the LEDCs raise their living condition because they earn enough money from the globalization. However, in many countries, only a few people really earn tons of money, rest of the people still make less money. For example, in China, there are people living in a super big mansion and driving a sport car, but there are people living in a super small apartment and earning a wage less than 0.5 dollar. The income disparities became a common thing with those countries that encountered globalization. 

Globalization affects my life enormously. Many thing I use are products of globalization. The computer I am typing was designed in California and made in China. The earphone I use to listen to music was from Japan. Without Globalization, it would be painful to not have those things in my life. I could have imagine myself living in a cave. Taiwan is a  country that strongly affected by the globalization. In the 1960s and 70s, Taiwan has cheaper labor and many global companies sent their electronic devices to Taiwan’s factory.  Taiwan was like the same with China now in that time. Taiwan would be in poverty without the effects of the globalization.   

topic 7: Government Farm Subsidies

The producers’ point of view is that the farm subsidies should not be existed. They questioned the validness of the Farm Bill which subsides famers to grow business. I agree with the producers’ point of view. I don’t think the farm bill should be put into practice. However, I believe some subsidies should be used because they are very important. For example, the subsidies to the banking industry and the car industry. Those two industries are crucial to US economy. According to CIA Factbook, the agriculture only composed 1.2% in US economy while industry and services composed the 98.8% of US economy. If those two industries fall, US will fall. Subsidies to those countries is too important to make it impossible to repudiate them. On the Contrary, some industry like food should be left to let the laws of supply of demand to determine. Because what happen to the industry, it would be less likely to cause a enormous damage to the country’s economy. 

In education, colleges, universities, high schools and elementary schools should be accepting the subsidies from the government. Education is fundamental to the economy. People with intelligence would help the economic to a better level. This kind of educational system is built up level by level. High schools, elementary school and colleges is like rings. Every ring is important to another ring. They ar buckled together to form the education. Therefore, people who don't have a kid as a student should pay taxes to support it.