Question

& © Aa Bo o Q Search February 20, 2020 at 9:04 PM Answer the following questions....both, to the best of your ability: 1. How would you explain the following statement: Economics is greatly impacted by how well information travels through society. Today, social media giants Twitter, Facebook, and Instagram are major forces on the information superhighway. (focus on the significance of information, in Economics, and why these companies are becoming Info Superhighways) 2. From the reading on Adam Smith, state two points that demonstrate that Adam Smith's insight into the 'selfish' human beings has an 'impact on how economies function. MacBook ALL

Answer 1

Solution

1.Yes

Economics is greatly impacted by how well the information passes through the society.As mentioned,today the social media plays a very important role in dissipating the information to the society.

By definition economics is all about how the individuals,organizations and the societies manage their needs and wants with the help of limited and scarce resources that are available.

These days through social media people people are able to get an access to more information in a quicker manner.More information leads to more choices and also more clarity on various choices available.So,ultimately the individuals and the societies can opt for a better/ informed choice based on their preference(efficiency,satisfaction etc.,)

These companies are becoming super highways of information because of their greater reach and connect with the people.These giants operate digitally.These days people have access to smart phones and other digital devices on which they can get access to this information easily and also almost at a very nominal price (many times free).Also accessing the simple is very easy and not time consuming when compared to other sources like newspaper,TV,etc.,.People can also personalize the content that they would wish to get on these media.

2.

a.Smith believed that prosperity always arises from the persuit of self-interest under free market conditions

This is related on how the economies function. Eventhough the different stakeholders have their own selfish motives of earning profit ,creating value for their shareholders etc., it may not affect the society adversely UNTILL and UNLESS the motives are conflicting with that of each other.When they are not they in fact serve / act like a boost to the society by the way of competition and ensuring efficiency

b.In fact if each stakeholder in an economy function in a manner that their actions are NOT conflicting then it is similar to the concept of specialization of labor in production.They only concentrate on their specific function and they become specialized in the same.It leads to more efficiency in the economy.

c.People in the same trade when they come together like in the case of monopolies and cartels cause inefficencies to the economies.

d.Too much regulation in the economy can also cause monopolies and other concentrated market structures which are inefficient when compared to that of the free market / competition market economy

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