eco 365 week 1 discussion

Week One Discussion Question

ECO 365
August 29,2013

Week One Discussion Question
What is economics? What role does economic play in your personal and organizational decisions? Provide an example of the role of economics in decision making?
According to the background history of economics, economics is the study of how individuals and groups make decisions with limited resources as to fulfilling and satisfying ones needs, desire, and wants. Economics is also another term related to money and the changes of principles of how people conduct trades, purchases, and wages. Economics is broken into two board categories known as microeconomics and macroeconomics. Microeconomics studies the decisions affected by the change of purchasing decisions and the influences from families. Macroeconomics studies the decisions made by individuals in a society, such as interest rates influenced by national savings.
Currently, the majority of society makes decisions based on how the economy is. When the economy goes through recession, it is hard for families to survive. People may be let go from his or her job and companies going through bankruptcy. Economic plays an important part in people’s life, whether it is a personal or organizational decision. Personal decisions affect people’s lifestyle and organization decision affects the people who work within the company. For example, economic affects the way how I live my life and maintain a job. Going back seven years ago my husband and I struggled trying to make ends meet when we were both working for minimum wage. We lived with his mom at that time while we were both in school and working. It is difficult trying to survive with a minimum wage salary. Our bills used up at least 70% of our income; therefore, we had no choice but to live at home with family.
It was a difficult time because we were young and we could not afford many things. At that time we were only making $8.00 an hour. We could not afford to go on vacations nor eat out. Interest rates were high and gas prices were rising as well. Unfortunately, when America hit hard and went through a recession many people loss jobs and we were part of that percentage. Thankfully, we lived still live at home so even though we could not pay for rent my mother-n-law took care of it. However, we had trouble paying for the car payments and credit cards. Seeking for employment was like a nightmare because not many places were hiring. It was either knowing someone to get hired or doing hard laborer like farming.
The economy was in bad shoe because many people were struggling as well. At least I was not alone and I never once gave up. I went back to an old job before I got laid off, even though the pay was not much it was better than nothing. After two years we finally made it, even though we are still currently struggling our lifestyle has changed. Since work has provided more stability and job security we can go on vacation and enjoy ourselves from time-to-time.
On a personal level, economic affects how the way I live my life. When the interest goes up, gas prices goes up that causes me to drive less and be a smarter shopper. I buy only the items I need and use not for luxury. Resources are limited and I believe it is important to use what I have before buying a replacement. I think twice before I spend my money and I eat at home majority throughout the week and set a spending budget.
In an organization level, economic affects how the way an organization conducts business. For example, nor-profit organization has a set budget; therefore, the company is limited with its available resources. The organization has to keep track of the spending allowance known as petty cash. Sometimes employees may experience hours cut because of the economy. Sometimes organizations cannot afford benefits for employees because of budget cuts.
Economic affects the way how people live and can change a person’s life. Economic studies how the way people spend money; therefore helps the government makes decision to better the nation. It is important to keep track of where and how money is spent and making sure the money flows in a cycle. The economy is like a roller coaster because even when the economy hits a recession it goes back up after a few years.

Reference
Colander, D. C. (2010). Economics (8th ed.). New York, NY: McGraw Hill.