monday4econlive

[monday4econlive]

The Impact of the Israel-Hamas Conflict on Starbucks 

A coffee company that once reigned supreme

It seems as if their profits and demand are headed downstream 

Sparked by the Israel-Hamas War

The lines in front of the BioSci Starbucks were unlike before 

Fall Quarter, lines wrapping around the corner 

Now once loyal customers look at it like a foreigner 

Gaining popularity, the boycott spreads 

So few customers that the baristas can’t even count heads 

A major player in a monopolistically competitive market 

Having a monopoly over its own differentiated good is the target 

Consumers purchase goods that are a close substitute 

Starbucks’ attempts to regain demand are moot 

I have written a poem that describes the effects of the Israel-Hamas conflict on the large corporation that is Starbucks. I have observed a decrease in customers at the Starbucks near the Biological Sciences Library on campus. Boycotting Starbucks became a popular subject on TikTok and has influenced many to stay away and find another coffee spot. I wanted to relate this very relevant issue back to the concepts of supply and demand as well as monopolistic competition. Due to changes in taste and preferences the demand for Starbucks has decreased. Starbucks is in a monopolistically competitive market and not an oligopoly because the company sells a differentiated product and not goods that are identical to the other competitors. 

Below is a graph that illustrates the impact of the Israel-Hamas War on the demand of Starbucks. 

Sources

Name: Jamie Tran (47186836)

[monday4econlive]

Monopoly and Power in the Market 

By : Rishabh Jotwani (39363740), Rohit Rarichan (36126645), Ernest Scherer (44283405)

Within our group, all three of us possess at least one Apple product. Ranging from iPhones to iPads, it has become a daily part of our lives for school, extracurriculars, and entertainment. We aren’t the only ones following this trend. Almost every student at this school has an Apple product because of the ease of use and the ecosystem that has been developed in our society. 

We can see this trend throughout the country and the figures below are justification to our claim.

(Source: https://www.oberlo.com/statistics/how-many-americans-have-iphones)

Apple has become one of the world's largest companies in terms of market capitalization and specializes in the tech industry, a market highly demanded in today's society. With their rising influence and dominating power over the tech market, they have created their monopoly using their clever business model and innovations. 

The above graph shows how the quantity produced relative to the demand has slowly been decreasing and the prices they set for their products have slowly been increasing to a monopolistic market. This shows their dominance in the tech market, especially the smartphone market. The company has total control over the prices they set and can affect the quantity they produce to maximize profits. The recent launch of the Apple Vision Pro is a great example of the above situation. The price set by Apple is much higher compared to the standard average for VR headsets- around $500. The Apple Vision Pro sells for about $3500, while it has many more features than a normal VR headset, the price still cannot be justified. However, customers who remain loyal to the brand continue to purchase the product despite its cons. One of the driving forces in their success as a monopoly figure is the brand loyalty that consumers have to Apple. 

Brand Loyalty: They have created a reputable and strong brand name for themselves over the years and found their way in almost every corner of the world. Their brand image brings high loyalty within their customer base. Their loyalty and dedication to the brand reach the point where customers disregard other brands or any form of comparison with similar products and are blindly ready to pay a premium for Apple products.

(source:https://www.pcmag.com/news/apple-iphone-brand-loyalty-in-us-at-all-time-high)

Apart from brand loyalty, Apple's clever business models compels customers to stay within the same operating system that Apple has developed and creates a situation where existing customers are more likely to return even with higher costs unless the opportunity cost of purchasing a different brand outweighs the switching cost. This situation is essentially created by the high switching cost associated with Apple products. 

Switching costs: Their clever business plan arises from the intricate ecosystem they have created for themselves. Apple has its own (operating software) ecosystem which allows different Apple devices to work together effortlessly. But this ecosystem is not very friendly with other operating systems and switching to a different standard is accompanied by a time-consuming and expensive process. Androids tend to have a problem with syncing their operating systems to different devices as well. Since Android devices have so many different software for different companies, some of the operating systems aren’t compatible with each other causing a hindrance for buyers in the market. Because of this, the ease of use Apple provides brings up an opportunity cost that many aren’t willing to pay for an Android counterpart.

Outside of the market of the United States tells a different story. Now with experience as an international student from Dubai, United Arab Emirates, the market is slightly different. Internationally, Apple takes more of an oligopoly stance instead of a monopolistic one due to more fierce competition and stronger competitive influence on buyers. 

Since the market isn’t catered to Apple, there is not a huge difference in the desire for an Apple phone over an Android phone. Apple holds its ground similar to other phone providers in this market, but doesn’t overwhelm the market such as in the United States. More customizability options, constant advances in technology, and that same comfortability given by an Apple product is why a large percentage of the world outside of the United States relies on Androids. Although the market is split decently even between the major brands, Apple's influence is slowly making its way around the world. Overall trends and the collective sheep herd mentality has led to people in the United States being prone to buying Apple products similar to their peers. Outside the country apple doesn’t have the same influence as the United States. A potential reason for the limited growth in other countries could be due to the weaker economies producing lower incomes and not being able to fit apple products in the budget curve. 

While its influence is slowly growing due to world wide economic growth, there is still a long time before they hold a large portion of the market internationally. Market demand, compatibility, ease of use, and other factors are why people who have been dedicated to Apple have begun to turn their attention towards Apple and it may explain why a large percentage of Apple users have chosen to stay with their platform as a loyal customer for years. This makes Apple a strong company that is slowly turning into a natural monopoly, something that will affect the tech market for the years to come.

[monday4econlive]

Opportunity Costs of Working in College and Healthcare

Here I am talking about the opportunity costs of my experience with both working while being in college and working in healthcare.

Name: Olivia Doria

ID: 33116839

Section: Monday 4PM

[monday4econlive]

The Sriracha Shortage

Since childhood, Sriracha has been a staple alongside every home-cooked meal. Its blend of citrusy-sweet heat seamlessly enhances the flavor profile of countless dishes, providing a consistent and familiar taste cherished by many families. With its timeless recipe and iconic bottle design, Sriracha became a fixture in households like mine, often taken for granted. However, when we realized it was absent from our local shelves, we embarked on a quest, visiting multiple supermarkets in the hopes of finding it restocked. Our fruitless search transformed the scarcity of the red bottle into the week's headline news: The Sriracha Shortage.

Amidst widespread media attention, people rushed to stores with remaining Sriracha stock, avidly hoarding as much as possible, given the uncertain duration of the shortage. This behavior mirrored the hoarding of toilet paper and hand sanitizer during the early stages of the COVID-19 pandemic in the United States. As the scarcity persisted, certain hoarders seized the opportunity to resell their extensive Sriracha supplies at exorbitant prices, reaching up to $70 per bottle. Numerous Americans eagerly sought to relish the flavor once more, with some resorting to pilfering sauces from local restaurants.

SUPPLY AND DEMAND

The depicted graph illustrates the supply and demand dynamics within the Huy Fong Sriracha Market. Here, quantity denotes the volume of Sriracha being manufactured or bought, while price signifies both production costs and consumers' willingness to pay for Sriracha. It's important to note that while this simplified linear graph provides insights, the actual Sriracha market is influenced by numerous factors beyond its representation. Nonetheless, this graph serves its purpose in facilitating analysis of market actions and their repercussions.

The intersection of the supply and demand curves signifies the market equilibrium in the Huy Fong Sriracha market. This implies that at quantity Q1, the cost to produce that amount of Sriracha is only P1. Simultaneously, consumers are willing to pay P1 for Q1 quantity of Sriracha. Any deviation from this equilibrium—whether producing more or less—leads to a socially inefficient market scenario where individuals either pay more than the production cost or less than the cost of producing Sriracha.

The crimson jalapeños, responsible for the sauce's tangy-sweet spiciness, are sensitive to temperature fluctuations and typically require meticulous handpicking. Moreover, a significant portion of these peppers is cultivated in arid regions of northern Mexico, reliant on water from the heavily burdened and fiercely disputed Colorado River. 

Due to the warming of our planet, one of the hottest summers struck Mexico’s drying lands to the point where water reservoirs are so low even water meant for agriculture has been burnt dry. Since Huy Fong’s supply chain is so delicate this became the main cause of scarcity of the sriracha sauce. 

If there is a reduced supply of jalapenos for Sriracha production, Huy Fong will produce less Sriracha at the same previous selling price. This can be illustrated by shifting the supply curve to the left, resulting in a new market equilibrium at a different intersection point.

In our new equilibrium, Q2 units of Sriracha will be sold at price P2. A comparison with the original quantity and price reveals a decrease in quantity and an increase in price at the new equilibrium. This demonstrates that with a lower supply, there is less of the product available at a higher price.

This principle is evident in real-life scenarios, where individuals who hoarded Sriracha during low supply periods in supermarkets capitalize on the scarcity by reselling it online at significantly inflated prices.

SUBSTITUTION EFFECT

For a whole year when there was no Huy Fong Sriracha left in stores, I started noticing many “alternatives” made by Tabasco, Trader Joes, Kikkoman, and many others. 

If the supply of Sriracha sauce decreases, its price is likely to increase due to the imbalance between supply and demand. This price increase prompts consumers to reassess their options. Some consumers may choose to continue purchasing Sriracha sauce despite its higher price, but others may opt for substitutes.

For example, consumers might turn to alternative hot sauces, such as Tabasco or Cholula, or they may experiment with making their own homemade versions of Sriracha. This shift in consumption patterns demonstrates the substitution effect in action. As the price of Sriracha rises or its availability decreases, consumers substitute it with other similar products to satisfy their preferences and needs.

MONOPOLISTIC COMPETITION

The substitution effect allows other firms to easily enter the “sriracha market” with each their own attempt at the product. This creates a monopolistic competition where there are many firms attempting to differentiate their hot sauce from other firms' attempts in making their own sriracha. 

This allows firms to make profits in the short run as illustrated by the graph below.

In monopolistic competition, firms can earn profits in the short run due to several factors. 

They have some control over pricing, allowing them to set prices above marginal cost if consumers perceive their differentiated products as unique and are willing to pay a premium. 

Product differentiation creates brand loyalty, enabling firms to charge higher prices. 

Limited competition within niches grants firms market power to set prices above marginal cost. 

Firms can capitalize on shifts in consumer preferences or demand to increase sales and revenues without incurring significant additional costs. 

Operating at a level where average total cost is below average revenue can lead to short-run profits, especially if fixed costs are covered by existing output. 

However, in the long run, the entry of new firms erodes these profits, ultimately driving prices down to the level of average total cost, resulting in zero economic profits. Even without new firms entering the market, as Huy Fong resumes production, the market will start to close for new firms that try to enter because personally I prefer the original Huy Fong sriracha much more than all the other substitutes/imitations.

Johnny Cheung

SID:25078726

[monday4econlive]

Pick-up vs. Delivery

We are four individuals living under one roof: Jenyfer, Brandon, Will, and Hannah. Throughout the week, we take turns cooking meals. However, when the weekend arrives, our laziness kicks in and we often opt to eat out. This habit sometimes leads to conflicts due to our differing preferences. For instance, last week, we couldn't agree on where to dine out. We narrowed down our options to three: Raising Cane's, Lanii’s Hawaiian BBQ, and SilverLake Ramen. Despite having only a few choices, conflicts still arose due to each person's preferences. To mitigate this, we decided to create a preference chart for each individual. Each of us listed our top three choices in order of preference. Although we have varying tastes, we aim to make economic decisions that satisfy everyone to some extent.

Will Preference: 

Hawaiian BBQ > Cane’s > Ramen = Hawaiian BBQ > Ramen

Hannah Preference:

Cane’s > Hawaiian BBQ > Ramen = Cane’s > Ramen

Jenyfer Preference :

Hawaiian BBQ > Cane’s > Ramen = Hawaiian BBQ > Ramen

Brandon Preference :

Ramen > Hawaiian BBQ > Cane’s = Ramen > Cane’s

Despite the fact that our options were limited to only three choices, all preferences were rational. This implies that each preference was both complete and transitive. Completeness was ensured, as everyone could articulate their preference among the two remaining alternatives. Transitivity was also evident, as individuals maintained consistent rankings between foods, resulting in no overlapping rankings, which would make it easier once we have our preferences ranked.

With everyone's preference choices already made and concluded, let's now examine the results. By examining each of our preferences and aligning them, we can systematically eliminate each option one by one. To commence, it's evident from these results that we're not opting for ramen. Ramen was the last choice for ¾ of our preferences. Moving on, we consider Raising Cane's, as it was the top choice for only one person, whereas everyone else ranked it lower on their preference scale. Now, we need to identify the option that resonated with everyone to some degree. It appears that Lani's Hawaiian BBQ fits this criterion, as it was either the first or second choice for half of the group. This logical deduction implies that although it wasn't everyone's absolute top choice, it was high enough on their list to ensure overall satisfaction. Moreover, our choices refute Arrow's impossibility theorem, as we were able to reach a decision as a group on where to dine. The majority preference for Lani's prevailed, with 2 out of 4 individuals selecting it as their top choice and the remaining two ranking it second. Thus, the principle of majority rule was upheld. Although Raising Cane's had two individuals rank it second, the majority's first choice was Lani's Hawaiian BBQ, which justifies our selection based on the comprehensiveness and consistency of our preference chart.

Now that we have determined what we should eat, we need to figure out a way to get our food. We can either physically drive to Lani's Hawaiian BBQ or have it delivered through Uber Eats. This is where the opportunity cost of both preferences comes into play. If we decide to have it delivered to our apartment, the opportunity cost will be the extra money spent on the delivery fee and the tip for the designated driver. On the other hand, if we choose to pick it up ourselves, the opportunity cost will be the time spent going to retrieve it. If we opt for delivery, we will roughly spend an extra $5-10. Whereas if we decide to pick it up ourselves, the opportunity cost becomes the time lost that could be spent studying, doing our everyday routines, or engaging in general fun activities like game nights. This is where everyone's budgets come into play, depending on how much each person is willing to spend.

Everyone's Individual Budget: 

Will: Budget of $20

Hannah: Budget of $15

Jenyfer: Budget of $25

Brandon: Budget of $40

The average cost of Hawaiian BBQ ranges from $15 to $20. Considering these budgets, half of the people would spend their budget solely on food, while the other half has enough money to cover both food and delivery charges. With this data in mind, we encounter a situation where Arrow’s Impossibility Theorem must be considered, as we require a decision-making process akin to a dictatorship to reach a conclusion. Otherwise, half of the people will engage in continuous arguments without reaching any consensus.Taking these factors into account, opting for food delivery would disadvantage half of the individuals, whereas physically going to collect the food would benefit one half and neither harm nor benefit the other. Therefore, to ensure the best outcome for everyone while staying within the budget, it's preferable to pick up the food in person, even though the opportunity cost is the time spent on transportation.

Group Members:

Jenyfer Alvarado #95381080

Brandon Moreno #62449694

[monday4econlive]

The Impact of the Israel-Hamas Conflict on Starbucks

A coffee company that once reigned supreme

It seems as if their profits and demand are headed downstream 

Sparked by the Israel-Hamas War

The lines in front of the BioSci Starbucks were unlike before 

Fall Quarter, lines wrapping around the corner 

Now once loyal customers look at it like a foreigner 

Gaining popularity, the boycott spreads 

So few customers that the baristas can’t even count heads 

A major player in a monopolistically competitive market 

Having a monopoly over its own differentiated good is the target 

Consumers purchase goods that are a close substitute 

Starbucks’ attempts to regain demand are moot 

I have written a poem that describes the effects of the Israel-Hamas conflict on the large corporation that is Starbucks. I have observed a decrease in customers at the Starbucks near the Biological Sciences Library on campus. Boycotting Starbucks became a popular subject on TikTok and has influenced many to stay away and find another coffee spot. I wanted to relate this very relevant issue back to the concepts of supply and demand as well as monopolistic competition. Due to changes in taste and preferences the demand for Starbucks has decreased. Starbucks is in a monopolistically competitive market and not an oligopoly because the company sells a differentiated product and not goods that are identical to the other competitors. 

Below is a graph that illustrates the impact of the Israel-Hamas War on the demand of Starbucks. 

Sources

Name: Jamie Tran (47186836)

[monday4econlive]

The Monopolistic competition of the Manga Industry

Z Zabarsky

ID: 78752167

I am an avid collector of manga as I have been collecting all sorts of series since 2015 which has led to my collection being about 600 volumes at the moment. There are multiple publishers in the industry but each series can only be published by one publisher. Since all the companies sell differentiated goods that are similar (different series) and compete with each other, the manga industry is a Monopolistic competition.

The way that these companies compete with each other is by trying to get licenses for series that the public would be more interested in buying. Famous series like Attack on Titan are well known and sell very well unlike smaller series like A School Frozen in Time. The bigger series are also more likely to be known by people who don’t read manga which can influence them to buy that series if they ever decided to get into it. However since the bigger the series, the more expensive the license is to get, newer publishers start out releasing the smaller series to get their name out there and hopefully make enough profit to buy licenses for more popular series. This reserves the popular series for the bigger companies; the biggest publisher, Viz Media, is the most popular publisher as it has the lowest prices and releases many of the top manga series such as My Hero Academia, Demon Slayer, Jujutsu Kaisen, and many more. Their high profits allow them to afford more of the popular series’s license, keeping them on the top of the manga industry.

As Viz Media has the lowest prices and sells the most quantity compared to all the other companies who have just about the same price and stock, the question arises to why that is. Since in monopolistic competition firms will produce where MR=MC and charge where the vertical line at that point intersects the demand curve; yet at first glance it seems that Viz is not operating at that point assuming that all the companies have similar marginal costs going off the similar prices. However there is an answer to why Viz produces more and charges less compared to the other publishers that non manga collectors wouldn’t know. The reason is that Viz has lowered their marginal cost by making the print of each volume they produce lower quality than other companies. Viz is known to manga collectors for commonly having misaligned spines, varied cut height, and even wrong contents inside the volume itself.

As you can see on the graph above, from Viz lowering their marginal cost, the quantity produced increases and the price charged decreases since the lower the MR curve, the more towards the right of the demand curve you produce. You can also see on the graph that this combined with Viz’s higher demand curve from having so many popular series causes Viz to make a bigger profit as shown by the purple box compared to the profits of other publishers shown by the green box. These higher profits allow for Viz to get even bigger and obtain even more licenses which the public want, further raising them to the top of the manga industry.

One may question why Viz’s sales are so good if their quality of goods is lower than the other publishers. The answer to this question is that manga is a bit more inelastic than other goods. Sure you can buy other volumes from other publishers but those will be different series since only one publisher can print a series. Because Viz has the license to the most popular series out of all the publishers, people are still willing to buy their books because they would rather own the series with a low quality print job than not own it at all. Also the more popular the series, the more inelastic the demand since fans will want to own it while smaller, unpopular series people won’t usually consider buying if it isn’t cheaper. This means the only form of competition there is between the companies is the licenses they have. This fact makes the reason Viz decided to lower their marginal costs more clear as since they have so many popular series that are in high demand because of the inelasticity compared to other series, they had to lower the costs so they could still produce where MR=MC to max profits while also producing enough quantity to supply the high demand.

The popularity of series is a huge factor for companies to consider in the long run as if they keep releasing series in which barely have any demand, the company’s demand curve is going to decrease as shown in the graph above to the point where the demand curve is below the ATC curve. The cause of this is the company’s profits will change from the green box on the graph which are positive profits, to the purple box which are negative profits, driving the publisher out of the market from bankruptcy.

This has happened before in the manga industry, the most notable one being the fall of TokyoPop. They went down this path of releasing many series in which not many people cared about as well as having a low print quality, causing them to go bankrupt from the lack of sales. However, years later they resurfaced and now focus mostly on one genre, leading to them owning most of the licenses of that genre. Since the genre is a pretty popular one, they get a good amount of sales because of the fact they own almost all the series of said genre.

[monday4econlive]

Rising Tides: Examining UCI's Tuition Surge Through the Prism of Econ 20A

Haolan Zhu Student ID:28284692

The tuition fees at UCI have increased by 18.61%, and this rise can be attributed to the increase in the number of applicants. The surge in applicants has led to an increase in quantity demanded, thereby driving up tuition fees. This is a classic example of market supply and demand dynamics, where suppliers adjust prices in response to increased demand to achieve equilibrium. Therefore, we can conclude that the primary reason for the tuition fee hike at UCI is the heightened demand pressure faced by the university, with the tuition adjustment being a response to this reality.

Simultaneously, the GDP inflation rate in the United States has reached 15.33%, which is also a contributing factor to the tuition fee increase. Inflation impacts the entire economic system, including the education sector. Typically, inflation leads to increased costs and expenditures, and universities may face rising operational costs. Therefore, tuition fee adjustments may also be a measure to counteract the effects of inflation. Thus, besides the increase in the number of applicants, inflation is also a significant factor contributing to the rise in UCI's tuition fees.

Because my income comes from China, when China's inflation is much lower than that of the United States, the gap between the real value of the Renminbi compared to the US dollar will become increasingly larger. Therefore as an international student from China, the nominal value of the tuition fee I have to pay is higher than the nominal value shown on the table.

[monday4econlive]

Opportunity Cost While Training in the Gym

Brian Yildirim

ID: 55692803

Discussion Day/Time: Monday 4:00-4:50 p.m.

In the gym, people have a choice to train any muscle group they please. However, like everything else, this comes at a cost. Instead of looking at the price of the membership, or the person's time, let's take a close look at the cost of the fatigue a person experiences with each given set.

For this scenario, let's imagine all sets are taken to failure, meaning the person doing the set can no longer push the weight up no matter how hard they try (which is how everybody should be training).

So, for each set, a person does, they will incur a cost of fatigue. This fatigue builds up more and more with each additional or marginal set. Meanwhile, the stimulus their muscles experience is diminishing with each marginal set.

So, with each marginal set done, the stimulus increases (but not as much as the previous set, by just a little), and the fatigue incurred also increases (by even more than the previous set). Therefore, in all workouts, there is an optimal number of sets a person should train for a given muscle group in a training session. This optimal number of sets would be where the cost (fatigue incurred) is equal to the benefit (muscle stimulus from a set).

Do too many sets for a muscle, and you will end up having to rest for a longer period and make lesser progress in strength. Do too little, and you aren't making the most out of your workouts. Of course, in the real world, this 'optimal volume of sets' is different for everyone, however, it is generally recognized that a person doesn't need to be doing more than 8 sets a week per muscle group. After those 8 sets, the fatigue incurred for the muscle is going to take a much longer time to recover from, meaning you will be able to train that muscle less often.

In the gym, there is an opportunity cost of muscle stimulus to fatigue, and this post examines the cost-benefit analysis of more sets completed.

[monday4econlive]

Opportunity cost of time

Your time is the most valuable asset you have, as everyone only has a limited amount and to do anything you need to use it. That is why it’s so hard to figure out what to do sometimes, will doing X activity bring me more value than doing Y? What is worth my time?

We can use the concept of opportunity cost to help us figure out this question, as we have to decide since by not choosing, we are inevitably choosing to do nothing, also using our time. The opportunity cost of doing x would be equal to what you would sacrifice to do X over what you would gain from doing X, using this sort of formula makes it easier to measure and value your decisions. For example, imagine you are very tired of studying, you could take a quick break or just keep studying, by using the concept of opportunity cost this decision may be a lot easier to take. By taking a break you would sacrifice time studying, however, you can gain more productivity from resting, or you could just keep studying, sacrificing your break and productivity, but gaining more time to study. All in all, the decision is much more straightforward, but it still depends on person to person, if that extra productivity would compensate for the time spent on break or not.

Unlike money which has a mostly fixed value, time has a very malleable value, as an extra hour to do an assignment would not make a big difference, however, an extra hour in a test can make a huge difference. This makes measuring the opportunity cost of your time very hard, nonetheless, always make a choice and opt to do the activities with the lowest opportunity costs, therefore making the most of your time. Furthermore, there is no way to store or save time for later, but sometimes it is possible to get a lot more value for it if you invest your time into inevitable chores. So, when a great opportunity cost of your time arises you have enough of it to make that deal.

In conclusion, relating our every day to economic concepts can help us make better decisions. As the study of scarcity, economics is great to help us model our resources, and how to better allocate them. As discussed, time is one of these resources, by measuring the opportunity costs of our decisions and how we use our time we can allocate it more efficiently and get a lot more value from it.

Pedro Asdourian Coelho

pacoelho@uci.edu

26102088

Discussion Monday 4 pm

[monday4econlive]

Opportunity Cost: How Will I Eat Today?

NAME: Miyu Chen

ID: 47573972

NAME: Ellen Kang

ID: 10858253

NAME: Abbygail Alejandrino

ID: 75944688

NAME: Quinn Acevedo

ID: 39394766

Being the first time living on my own and being in charge of my own meals, I found that I had a variety of options to choose from when it came to feeding myself. I didn’t have a set dining plan to keep me fed nor did I know how to shop for groceries. With the semester coming up, I had to figure out quickly what options I suited my living situation the best. To do so, I had to weigh the opportunity costs of each option I considered. 

First, I had to explore my options. What was there available for me? I debated on cooking on my own, getting a dining plan, or buying takeout. After a while, I decided to cook at home considering I didn’t get paid much from my part-time job. However, to reach that conclusion, I had to consider what I was losing by declining the others.

Opportunity costs: 

The first opportunity cost of cooking at home is saving time. Cooking includes buying ingredients, preparing the ingredients, and cooking in itself. While not all meals take a long time to make, it’s still more convenient to go out to buy food. I could use the time for my academics, spending time with friends, or to engage in my hobbies. By choosing cooking, I’m choosing to spend an hour of my day preparing a meal and losing the opportunity to find something to eat within a much shorter time frame. 

Another opportunity cost is using my time in a timely manner. As a freshman in college, the Anteatery is a part of my tuition and is right next to my dorm. It would be convenient to go and eat there rather than walk all the way to University Town Center to grab Chick-Fil-A. Since it is part of the fees I pay to stay on campus, it is a benefit to save time and money and eat there or cook in my dorm. 

Another opportunity cost is losing the variety of meals in which you can choose to buy. While this varies based on what area you live in, Irvine is home to many diners that offer a diverse selection of cuisine. Of course, there’s always the option to make whatever you’d like at home. However, like many college students, I was confined to my limiting paycheck and time constraints due to my job and schoolwork. These limiting factors only allowed myself to make simple meals compared to what I was truly craving. While cooking is much more cost-efficient, I was losing the chance to eat meals I simply couldn’t prepare at home. 

Lastly, cooking requires labor that takeout or eating at the dining hall have the luxury to skip. As mentioned before, cooking requires finding the ingredients, preparing them, and cooking them to a recipe you must already be familiar with. If you’re following a recipe for the first time, it’s often more time-consuming than making something you’ve made many times before. Defrosting an item from the freezer, marinating meat, and other methods of preparation require attention and more time out of your day. With takeout or the dining hall, the food is already made and ready for you to eat once you make the purchase. 

[monday4econlive]

Econ Live: Thrifting and Online Shopping

Andre Dimri, Derrek Zaragoza, JP Aquino

ID #: (Andre)73662750, (Derrek)35059723, (JP)77546150

As our comprehension of various economic aspects deepens, we naturally begin to perceive parallels between these concepts and the economies in which we engage, whether as consumers or producers. One such economy that holds particular significance for me is Depop. For those unfamiliar, Depop is an online marketplace where individuals buy and sell clothing. (I would know; I spend $100 monthly on baggy jeans and workwear jackets. It's not a problem I can stop whenever I want -Andre.) 

Depop functions as a free-entry market, enabling anyone to sell and trade their clothing, fostering an environment characterized by perfect competition, akin to an infinite number of individual sellers (or firms).

Image: Example of Perfect Competition Market

Images: Comparison of two different jeans found on Depop; one production has been discontinued while other is still in production.

Despite operating within a market characterized by perfect competition, certain individuals on Depop possess a comparative advantage over others, allowing them to generate higher profits. As mentioned earlier, vintage and designer clothing often fetch higher prices due to their scarcity. Consequently, some individuals dedicated considerable time scouring thrift stores, flea markets, and other platforms to acquire these items at lower prices, which they then sell at a substantial markup. Given that most Depop consumers cannot invest the same amount of time and resources into acquiring scarce items, their profit margins are inevitably lower. Furthermore, these sellers wield considerable influence over the market prices of specific rare items they control the supply of. For example, classic JNCO jeans, whose production ceased in the early 2000s, have become scarce on the platform. Consequently, sellers who possess these jeans can command significantly higher prices compared to other sellers, incentivizing them to focus their efforts on accumulating these jeans, albeit at the opportunity cost of acquiring other types of clothing. All though this benefits these sellers with more profit, it results in the external cost of making such items like JNCO jeans unaffordable to most consumers.

Image: JNCO Jeans which originally retailed for $65, now selling for $250 on average due to scarcity

[monday4econlive]

Local fish store closure

Over the past few years, I have been learning about and exploring the hobby of fishkeeping. Keeping fish in an aquarium is not something new in my life; my father has been a fishkeeper for 20 plus years, and would take me to fish stores when I was younger. As a child, I would be hypnotized by the graceful swimming of fish sporting many different colors, shapes, and sizes. However, it is only in recent years that I have inherited my father’s enthusiasm (as my father likes to say, the genes were finally expressed) and decided to try keeping fish myself. Surprisingly, this process has unknowingly taught me economics, which I can now articulate into words and concepts.

I can relate many topics in the aquarium hobby to economics, such as scarcity of resources in plant development or balancing prices as a consumer, but the subject I will mainly focus on is the decrease in local fish stores in my home city of Torrance. When I was younger, the aquarium hobby in Torrance was more accessible compared to today; there were three or four local fish stores my father and I would often frequent. From economics, we know the costs for a business generally are divided into variable costs and fixed costs. Variable costs in fish stores can be represented by the amount of stock ordered and employee wages. Fixed costs can be attributed to leasing the space for the store and the cost of running the store (I would imagine water costs would be especially high for fish stores due to the amount of water needed for the aquariums). Fixed costs are generally stable for fish stores, but variable costs are extremely turbulent; this is one factor that causes them to close down. There are large shipping fees directly related to gas prices which come from transporting fish mainly bred in farther areas like Florida or Southeast Asia. In addition, it is difficult to know which fish will sell and how many to buy. This is the other part which causes fish stores to close: the shift in consumer demand. It is not easy to predict changes in the demand curve, and for the local fish store, changing prices to match shifts in the demand requires a large amount of foresight which the average fish store owner may not have. For a smaller hobby like fishkeeping, demand is often the most important factor in predicting business closure.

In general, businesses tend to exit the market when profits fall below the average total cost. For local fish stores, this relationship is extremely unstable. I believe this to be the cause of many local fish stores in Torrance to close down.

Another part which contributes to local fish store closure is competition between local stores and bigger businesses such as Petco and Petsmart. These kinds of stores do not solely rely on fish and aquarium-related sales to keep their business afloat, and so can afford to lose some profits in the fish area. From personal experience, I have observed that the prices for dry goods are on average higher for local fish stores when compared to Petco; I believe this is because of the reliance for local fish stores on one consumer group. 

On another note, I have observed economics in another area of my personal fishkeeping experience. There is a phenomenon among fishkeepers known as multiple tank syndrome, or MTS. MTS comes with the sudden urge to expand the amount of aquariums in one’s home. For me, it went from owning one 10-gallon aquarium to two 10-gallon aquariums and another 29-gallon aquarium. This decision did not come with meticulous planning or forethought, but was impulsive–as a result, I had to give up more time and energy than I expected! However, I can confidently say that this syndrome has taught me an important lesson in economics–the significance of opportunity cost and trade-offs. While I enjoyed the process of setting up and looking at the new aquariums, I was ultimately giving up a large portion of time and money spent on maintenance. In the long-run, I found that the enjoyment was not worth the extra cost of maintenance which I had not foreseen beforehand; if I had put a little more thought into it, I would have realized this sooner and would not have gone through with it!

Here is a picture of my 29-gallon fish tank.

Nicolas Kamitsubo

ID: 11435142

Tuesday@7pm discussion period

[monday4econlive]

Econ Live: A College Student's Consumption of Caffeine and Snacks

Alice Luong

Student ID#: 73909223

[monday4econlive]

Raving in California

John Tran

ID: 45403878

I. Introduction:

Being within the California rave community, I, alongside with many others, have noticed the cost of attending events and purchasing items at the venue, will lead to a large debt in many people’s accounts. There have been many justifications made within regards to the expenses, yet there is a more economical standpoint behind such entertainment activity. 

When attending a small rave, there is usually a popular dj and a couple of openers (3-4), where these are rising artists. When it comes to festivals (consisting more than 2 days), there are over 30 DJs who perform at different times throughout the majority of the day. To ravers, the price to attend these small raves/festivals usually range from $20-$400, depending on the scale of the event. Many ravers are phased depending on the price for the lineup that is presented, as whether the genre of EDM music they would not pay or there is a large dislike on the lineup.

The market for raving in California will display an inelastic demand for raving within California. Although there are other substitutes for entertainment, a lot of ravers find raving as their main hobby and do not invest as much money into other forms of entertainment. With the exclusive lineups and unique experiences at every rave, the demand is inelastic. Being such a community ground for many people, ravers find many prices justified, as they are able to receive such positive interactions with the community.

III. Oligopoly Environment

Raving in California, mainly ravers would only know of Insomniac Events. Insomniac Events hosts large venues at San Bernardino’s NOS Event Center and is most known for EDC (largest EDM festival, but in Vegas). Their similar competitors would be Brownies and Lemonade or Live Nation, but still the largeness of Insomniac Events is incomparable, as they have been around for the longest time within EDM history. They are considered the root of how EDM has become popularized today. Many of the smaller raves are called underground, as smaller EDM companies fail to get recognition with the amount of legal compliance required within California and the high initial investment for the venue, lasers, sound systems, etc. 

[monday4econlive]

UCI Coffee and Cafes

Ryan Chen ID: 95883843

Introduction: Coffee is one of the most popular drinks we consume daily as adults. As a direct result, UCI has a wide selection of cafes across campus for students and faculty to choose from. Each offers different options not only in terms of food and beverages, but also the location and convenience they provide. Personally, I’ve always found myself going to the Starbucks on Ring Road near the Student Center the most often as most of my classes are there and the Starbucks there is fairly spacious and inviting. As someone who loves drinking coffee and exploring cafes across Orange County, I’ve made it my mission to analyze the market of coffee shops around UCI, what makes each cafe attractive to consumers, and possible changes that could occur that may affect the market.

I. Market Type

When first analyzing the market type of cafes across the UCI campus, household names such as Starbucks and Peet’s Coffee immediately capture one’s attention. But we also have to consider the other lesser-known cafes across campus such as the one in the Phoneix Food Court, Java City Cafe near Engineering Hall, Cafe Expresso at both Physical and Health Science plazas, and many others which hold great attention from the people who visit. As a result, we can conclude that the cafes at UCI have a market structure of monopolistic competition as they each all offer similar but differentiated products with each cafe offering a unique atmosphere, menu items, or specialty beverages to attract students.

II. Coffee as a product

Generally, coffee is known as a normal good, which means that the demand for coffee increases as income increase. That being said, Irvine is a pretty high income city compared to many other parts of California, meaning that the demand for coffee and coffee shops is already very high since many residents have disposable income and can afford coffee often, reinforcing the income effect.

In addition, for normal goods, the income elasticity of demand is positive, indicating that as income rises, the quantity demanded increases. In the case of coffee in Irvine, where incomes are relatively high, the income elasticity of demand for coffee is likely to be relatively high as well, indicating a strong relationship between income and the quantity demanded of coffee.

III. Changes If the overall economy of the U.S. went into decline, smaller cafes would start closing down since their revenue would not be enough to keep their cafes running. Larger cafes like Starbucks may still be able to operate even if they are incurring a loss as their capital is significantly larger than other cafes. In another situation, if the economy was doing well and more companies want to enter in, more cafes would be added to the UCI campus. The result of this may lead to increased competition among existing cafe brands. Established brands with a loyal customer base and strong brand recognition may be better positioned to withstand competition and maintain their market share. Conversely, newer or less well-known brands may face challenges in attracting customers and may experience a decrease in market share.

Conclusion:

The coffee market at UCI presents a dynamic landscape characterized by monopolistic competition, with many selections of cafes each offering unique products and atmospheres to cater to the preferences of students and faculty. As a normal good, coffee enjoys steady demand in Irvine's community, with a likely high-income elasticity that suggests a close relationship between income levels and coffee consumption. However, the market is susceptible to fluctuations in the broader economy, with economic downturns posing challenges for smaller cafes while larger chains like Starbucks may maintain stability due to their significant capital reserves. Conversely, economic upturns may spur increased competition, potentially reshaping market dynamics and challenging established brands. Overall, the UCI coffee market underscores the interactions between internal differentiation strategies and external economic factors in shaping consumer choices and market outcomes.

[monday4econlive]

Opportunity Cost ( Playing Soccer or Studying)

Gianni Wang Student ID ( 83022194 )

Kennedy Xivir Student ID ( 14486582)

This is a song that talks about the opportunity cost of playing soccer or going to study. Being soccer players we have to make this decision whether we go kick a ball around or we study for our classes. This song is a parody of “Hotline Bling” by Drake. 

You used to call me on my cell phone,

Late nights, studying all alone.

Thinking ‘bout the field, where i wanna be,

But these textbooks keep calling me.

You know when that soccer ball swings,

It can only mean one thing. 

Gotta choose between goals and grades,

Opportunity cost, it never fades.

Ever since I left the pitch, I,

Started hitting the books, it's true.

But every time I see that green,

I’m torn between game and grades

You know when that deadline’s near,

And the game day’s drawing near.

Gotta decide where to invest my time,

Balancing goals, it’s like a crime.

Late nights on the field, or in the library,

Which one’s gonna bring out the best in me?

It’s a trade-off, a choice to make,

Study hard or risk the grades at stake.

You know when that whistle blows,

And the pressure starts to grow.

Gotta weigh the cost, choose what's right,

In the end, gotta shine bright.

So I’ll hustle on the field or I’ll hit the books,

Trying to decide what I do,

But when it comes down to what matters most,

I’ll know the true cost, seeing my classes through.

For us we could either be hitting the fields at the arc for a couple hours passing the ball around or we could be studying for our upcoming finals. We have to make these decisions by weighing what the loss is from picking one of the options. If we were to go play soccer for 2 hours, then that's 2 hours of studying that we just lost. But, if we decide we need to study, then that's 2 hours of playing soccer that we just lost. We tell ourselves, we will hit the fields for a bit and then lock in. But it turns out we are so exhausted that we end up studying less.  We would need to take into consideration the amount of free time we have and if there's something we need to study for. Let's look at what I get out of studying instead of playing soccer

Here we see a production possibility frontier that portrays the possible production possibilities when our inputs are fully utilized. The more time we spend on one thing the less we have for the other. For example if we were to spend 5 hours playing soccer. We would spend zero time studying. You would ask why don’t we spend 4 hours playing soccer and then you study for 3 hours. There are two zone, the area under the curve is the feasible zone, meaning you are able to do it but it might not be very efficient, anything able the line/curve is not feasible meaning you can’t do it because you don’t have the resources or in our case you pass out because you are tired. 

Academic success: If we were to study rather than play soccer, then this can lead to us getting a higher grade, have a better understanding of the class, and just overall academic success

Future Opportunities: Studying could lead to stronger academic performances and this could give us future opportunities in careers.

Personal Growth: Studying gives us a challenge, so this will help with our critical thinking skills, and helps with our personal development

Long-term Benefits: Investing time into studying can lead to lifelong learning and intellectual fulfillment.

Now let's look at what we get out of playing soccer:

Physical Fitness: Playing soccer is a great way to exercise, it helps with our stamina, strength, agility, and our overall fitness

Stress Relief: Playing soccer is a stress reliever, it’s a way to take our mind off of school and just focus on the moment.

Social Interaction: Playing soccer gives us opportunities to socialize with others, making friends, and building a sense of community with others

Improves skills: Playing helps us improve our touches, improve our dribbling, and helps with our game IQ

Overall, both have great benefits and it is a difficult decision to make on what we want to do. Even though soccer has all these great benefits, studying provides better ones allowing us to have a better understanding about classes, having improved grades, and better overall for the future. Sometimes