Categories
Labor Principles

Outsourcing a Task

There’s a big mess in the backroom, but Mateo is on the phone trying to secure Celine Dion tickets. Garret tries to recommend hiring someone from an app to wait in line for Mateo, but Mateo reverses it and suggests that the two of them hire someone to clean the mess for them. They are outsourcing their jobs to someone who is willing to do the job for less while they focus on the things they want to do.

Categories
Supply & Demand

Uber Surge Pricing

A large blizzard has hit the area and the employees have finally decided to go home. While outside, some of the employees appear stuck because public transportation may not be working. Garrett suggests a few of them share an Uber, but because of the increased demand for transportation, the ride is surging to $1,400. The employees decide to head back inside.

Categories
Principles

Opportunity Cost of Surrogacy

Glenn and Jerusha are having trouble finding a surrogate for their next child, but Dina becomes very interested. She considers that $20,000 is roughly how much money she earns in a year and begins pondering the things she would spend the money on. Dina and Glenn don’t get along, so they go through the effort to make it seem like they aren’t really interested, but both see the opportunity to exchange cash for surrogacy.

Categories
Labor Supply & Demand

Discount Surrogacy

Glenn has found a potential surrogate online, but it seems more like he may be interviewing a kidnapper. While he believes he’s interviewing a potential surrogate, he goes through the process of identifying her reservation wage. A reservation wage is the lowest amount that a worker is willing to accept. He mentions that he and his wife only have $20,000, which the surrogate agrees to. He then lowers it to $15,000 and she still is willing to accept it. When he tries to go down to $10,000 she notes that it’s too low. Because Glenn is willing to pay $20,000 for a surrogate, any price below that will result in consumer surplus for his family.

Categories
Principles

Black Market Medication

After coming down with an ear infection, Mateo reaches out to the pharmacist to see if he can get some medicine to help. He doesn’t have enough money to get a prescription, so he’s hoping he can bypass that system and go directly to the pharmacist. Tate subtly emphasizes that pills get miscounted all the time, implying that he can sell Mateo some drugs in exchange for cash. Black market transactions are hard to track, but they still represent an economic transaction where one person has something that another covets.

Categories
Money

Cash Only

The registers are down, and the store is only accepting cash. It appears no customers are willing to shop under these conditions. While currency can be used as a medium of exchange, both parties need to be willing to make that transaction.