Purpose of Assignment

Week 5 exposes students to subjects that are intended to whet their appetites for further study in economics. Students will use the theory of consumer choice and the impact of the concepts of asymmetric information, political economy, and behavior economics, to describe how consumers make economic decisions.

Assignment Steps

Scenario: You have been asked to assist your organization’s marketing department to better understand how consumers make economic decisions.

Write a minimum of a 1,300-word analysis that includes the following in separate sections with appropriate headings:

• How demand curves are constructed using the theory of consumer choice.
• How consumer choice and the budget constraint are affected by:

1. Higher wages
2. Higher interest rates

• The role asymmetric information has in many economic transactions
• The Condorcet Paradox and Arrow’s Impossibility Theorem in the political economy
• People not being rational in behavior economics

Use the textbook as your only source. Failure to properly cite and reference the paper is considered plagiarism. See the CWE page of the Library on how to prevent plagiarism.

Format consistent with APA guidelines, including an introduction, conclusion, citations, a title page, and a reference page. The correct in-text citation for the textbook is (Mankiw, 2015) and the reference is:

Mankiw, N.Gregory. (2015). Principles of Microeconomics, 7th Edition, Stamford, CT. Cengage Learning.