What is the author assuming I will agree with?
Do you agree with the author?
Unit 1
Decision-Making Behaviors in Economic Activities
Lead-in
Reading critically: questions for discussion
Unit 1
Decision-Making Behaviors in Economic Activities
• Lead-in – Reading critically: questions for discussion
Unit 1
Decision-Making Behaviors in Economic Activities
When the price rises: It provides an incentive for buyers to consume less; It provides an incentive for sellers to produce more.
Unit 1
Decision-Making Behaviors in Economic Activities
What do you consider when you make this decision?
Unit 1
Decision-Making Behaviors in Economic Activities
• Text A – – – – Key terms Critical reading and thinking Difficult sentences English language for academic purpose
• Specialized vocabulary • Collocations • Formal and informal English • Signpost language
Unit 1
Decision-Making Behaviors in Economic Activities
Text A
Key terms
rational people: 理性人 Those people who systematically and purposefully do the best they can to achieve their objectives, given the available opportunities.
Unit 1
Decision-Making Behaviors in Economic Activities
Text A
Critical reading and thinking
Example 3: a seat belt law
American laws require seat belts as standard equipment on new cars.
Unit 1
Decision-Making Behaviors in Economic Activities
Text A
Critical reading and thinking
How People Make Decisions
Economists’ explanation about decision making: There are rules behind people’s decision-making behaviors.
Unit 1
Decision-Making Behaviors in Critical readingvities Rational people think at the margin.
Text A
Example 1: standby tickets What a rational airline can do?
Conclusion: As long as the standby passenger pays more than the marginal cost, selling the ticket is profitable.
Unit 1
Decision-Making Behaviors in Economic Activities
Unit 1
Decision-Making Behaviors in Economic Activities
Lead-in
Reading critically: questions for discussion
Reading critically:
Every text is written on a purpose, some are supposed to make you believe. It is important to learn to read critically to get the point. One way of training critical reading is to ask yourself the following questions: What is the author trying to prove?
Text A
Critical reading and thinking
Example 2: a tax on gasoline How people respond to incentives? Encourage people to □ drive small, more fuel-efficient cars; □ carpool □ take public transportation; □ live closer to where they work; □ drive hybrid cars; □ drive electric cars.
How a seat belt law alters a driver’s costbenefit calculation (Peltzman’s analysis): Seat belts reduce the likelihood of injury or death → make accidents less costly → drive faster and less carefully → a large number of accidents
Unit 1
Decision-Making Behaviors in Economic Activities
Text A
Key terms
marginal cost: 边际成本 the additional cost from an increase in an activity marginal decision-making: 边际决策 the additional cost from an increase in an activity incentive: 激励 something that induces a person to act
Unit 1
Decision-Making Behaviors in Economic Activities
Text A
Critical reading and thinking
Answer: Yes. Reason: If the plane has empty seat, the cost of adding one more passenger is tiny. Here the marginal cost is merely the cost of something to eat, like peanuts, coco, etc.
Unit 1
Decision-Making Behaviors in Economic Activities
Text A
Critical reading and thinking
Conclusion: Rational people think at the margin. (They make decisions by comparing costs and benefits.)
Unit 1
Decision-Making Behaviors in Economic Activities
Lead-in
Reading critically: questions for discussion
Discuss the following questions:
How do you make the decision that you take this course?
Does the author adequately defend their argument? What kind of proof do they use? Is there something they leave out that you would put in? Does putting it in hurt their argument?
Situation: Flying a 200-seat plane across the U.S. costs the airline $100,000.
Cost of each seat: $500 (That’s to say, never sell a ticket for less than $500.) Suppose: A plane is about to take off with 10 empty seats. A standby passenger will pay $300 for a seat. Question: should the airline sell the ticket?