Microeconomic Analysis

Situation A

In both macroeconomics and microeconomics, the applicable principles of economics are relatively the same. The principles of economy are used by the participants in the economy to determine the level of participation and whether their involvements are viable (Frank & Ben, 2004). Economic calculations, on the other hand, are intended to attain; a candid analysis of the present condition of the entity/ industry as well as measuring the going concern of the entity/ industry. The following principles of economics shall be applied throughout this paper;

• People choose
• Every choice has a cost
• Benefit /cost analysis is useful
• Incentives matter
• Exchange benefits the traders
• Market works with competition, incentives, and property rights
• Skills and knowledge influence income
• Monetary and fiscal policies affect people’s choices, and,
• Government policies have benefits and costs.

This paper analysis the above principles of economics on the basis of the case study that is highlighted below. The paper is being used by a student in the health industry in evaluating whether to continue pursuing the career path or to change the course. The aim of the paper is to show the physical application of the principles of economics and how decisions are made in microeconomics.

Case analysis

A California based organization has been carrying out study on the movements of health workers since 2008. The report (which is dated as back as 2004) indicate that the rate of physicians and other health workers has been on the decline since 2010 (MLTPL, 2014). This has raised fears among students in this industry on the viability of their careers. This is a microeconomics case which is dependent on one feature of an industry. The study has cited out the specific reasons that had caused high rate of movement in earlier years as; better remuneration, better working conditions and/or heavy burden of work. While it is yet to be established whether these conditions have changed, an analysis to determine the viability of the career is vital.

Demand Determinants:

A. Individual determinant analyzed for situation, with examples applicable to your situation

Vacancies to be filled; the most obvious source of employment for the persons who are not employed in a society is the need to fill vacancies that have been left by the vacating staff. The staff may have either retired or moved to other companies, locations and careers. The decreasing move rate in the health industry creates fewer opportunities each year for the unemployed in the industry.

Need for increased workforce due to increased population; the data that has been collected by SK&A is silent on the population increase/ decrease in the United States of America in the time in review. However, data from the national Bureau of statistics indicate that there is relevant rise in popul