Practicum Assignment – Principles of MacroeconomicsPracticum means “the part of a course consisting of practical work in a particular field.” For economics, this means working with real-world data and the theories we’ve been reading. Nothing is free, at least from the perspective of an economist. Another way of stating this is to realize that everything has a benefit and a cost, neither of which has to be expressed in terms of money. There are other ways to look at costs.Chapter 9 of your textbook looks at consumer prices and inflation. This practicum puts into practice those ideas along with opportunity cost. Your tasks:(1) Create a table in which you listfive items that you purchase each month, the quantity of each item, the price, and item and grand total. Example:ItemQuantityPrice per monthTotal per yearCellphone service12 months$65 per month$780.00Gasoline50 gallons month x12$3.00 per gallon$1800.00Car Insurance12 months$100 per month$1200.00Internet Service12 months$65 per month$780.00Starbucks Coffee4 Tall Brewed$12.00 per month$144.00Grand Total Per Year$4704.00 You have just calculated a small part of the cost of living in your area.Next:(2) How much do you earn? There will be two calculations for this part. (A) Take your annual salary/wages and divide by 2080 hours. This is the standard number of working hours per year, a number used by businesses to estimate/calculate benefits, etc. Your resulting number will be your hourly wage. If you work for an hourly wage already, then you do not need to calculate your hourly wage. If you do not work, use the minimum wage of $7.50 per hour. For a comparative assessment, use $48,000 as your annual salary and do the same calculations. (Note: You do not need to reveal confidential financial information. Use general approximations for this exercise unless you want something more precise for yourself. All submissions are confidential.)If your parents pay, get an estimate. If you don’t drive, find another item. The objective is for you to list items that are purchased regularly throughout the year. Parents or guardians pay so someone is paying and we need an idea of what is being spent.
(3) The average number of hours worked per day is 8 hours. So, calculate the number of days it would take you to pay for your cost-of-living expenses. This number will vary based on your hourly wage. NOTE: You have two scenarios from (2); therefore, you will have two calculations for the number of days.Example: If I earn $6.50 an hour, and I divide $4707/$6.50 = 723.69 hours of work to cover my expenses. Since there are 8 hours of work in a typical day, I’d have to work 90 days just to pay for the above items. In a typical calculation, there are about 260 work days in a year, which means that the first 90 days would be used to pay for the above items or 35% of the year. Another way of looking at it would be to say that working January – March plus part of April pays for my basic expenses.(4) Write a brief economic analysis (3 pages of writing with an additional page that shows your table and wage/salary calculations). a. What is an economic analysis? Not a personal essay or editorial rather an analysis of your findings given what you have learned about economics. b. Economic analysis considers the opportunity costs of choices. For example, what are the outcomes and how do they fit with ideas from Chapters 1 and 2? Why? c. Use your economics textbook to elaborate on your analysis. How does this fit with our studies? How does human capital fit in? How does opportunity cost apply? Can you change this calculation to benefit your cost of living? d. Consider how your spending habits might impact on the community. e. Consider how your cultural perspective and that of others might influence the components of the cost of living.These are examples of what to include in your writing. Your textbook has more insight for this type of analysis.Grade out of 100 points: 1. Construction of table and calculations = 40%2. Clearly displayed wages and calculations of day-cost = 25%3. Economic analysis with clear references to our textbook readings =35%4. See your syllabus for expectations in writing for economics. Your analysis must be in essay formatSUBMIT YOUR ASSIGNMENT ONLINE THROUGH CANVAS – WARNINGS:ONLY ONE SUBMISSION CONSISTING OF 4 PAGES NOT SEVERAL SEPARATE ITEMS. YOUR ESSAY SHOULD BE NO MORE THAN 4 AND NOT LESS THAT 3 PAGES
TYPED, SINGLE SPACED, TIMES NEW ROMAN 12 POINT WITH 1 INCH MARGINS PLUS ONE PAGE WITH TABLE AND CALCULATIONS IN ONE DOCUMENT.EACH STUDENT IS DIFFERENT SO PLEASE DO NOT COPY.