Do Economic Analysis In the lesson “Your Own Inquiry: Doing Economic Analysis,” you considered whether the problem and solution you are studying can be analyzed using a market framework (that is, demand and supply) or whether it should be analyzed as an individual choice.

If Using Market Framework 1) Use this modified version of the 6 steps for economic analysis to illustrate the problem you are focusing on and a potential solution to it. a) Define the market. Be precise about what is being exchanged, the geographic extent of the market, and the time frame. b) Draw a graph of the market representing initial demand and supply. Identify the initial equilibrium on the graph. Think about who is doing the deciding. c) Decide if the solution should be represented by a change in price only or a change in something besides price. d) If something besides price changes, decide if consumers or producers will be the first to be affected. e) Use your answers to (c) and (d) to show the solution on your graph. f) Use your graph to predict how the solution will affect changes in price or quantity. g) List elements of technological, legal/political, and cultural context that could affect the market. Include at least one element from all 3 layers. 2) Write 1 paragraphs about steps (a)-(f ). 3) Write 1 paragraph about step (g). If Using Individual Choice Framework 1) Use these steps for economic analysis of a choice. a) Identify the decider and the decider’s objective. b) Define the choice that must be made. Be clear about the alternatives. c) Why does a choice have to be made? What resources are scarce? d) Describe the status quo in terms of benefits and costs to the decider. i) List elements of context (technological, legal/political, and cultural) that influence the benefits of a positive choice. ii) List elements of context (technological, legal/political, and cultural) that influence the money costs and opportunity costs of a positive choice. iii) Use a graphic of your choosing to illustrate the costs and benefits. e) Does the change affect benefit to the decider or cost to the decider? f) Does the change increase or decrease benefits (or costs) enough to change the choice? 2) Write 1 paragraphs about steps (a)-(c). 3) Write 1 paragraph about step (d)-(f).