Foundations of MICROECONOMICS

A01_BADE7725_09_SE_FM.indd 1 12/18/19 2:54 AM A01_BADE7725_09_SE_FM.indd 2 12/18/19 2:54 AM Foundations of MICROECONOMICS

Robin Bade Michael Parkin University of Western Ontario

NINTH EDITION

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Library of Congress Cataloging-in-Publication Data Names: Bade, Robin, author. | Parkin, Michael, author. Title: Foundations of Economics / Robin Bade, Michael Parkin, University of Western Ontario. Description: Ninth edition. | New York, NY : Pearson, [2021] | Includes index. Identifiers: LCCN 2019050192 (print) | LCCN 2019050193 (ebook) | ISBN 9780135917725 (paperback) | ISBN 9780135894019 (paperback) | ISBN 9780135814260 (paperback) | ISBN 9780135896952 (epub) Subjects: LCSH: Economics. Classification: LCC HB171.5 .B155 2021 (print) | LCC HB171.5 (ebook) | DDC 330—dc23 LC record available at https://lccn.loc.gov/2019050192 LC ebook record available at https://lccn.loc.gov/2019050193

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ISBN 10: 0-13-591772-7 ISBN 13: 978-0-13591772-5

A01_BADE7725_09_SE_FM.indd 4 12/18/19 2:54 AM To Erin, Tessa, Jack, Abby, and Sophie

A01_BADE7725_09_SE_FM.indd 5 12/18/19 2:54 AM A01_BADE7725_09_SE_FM.indd 6 12/18/19 2:54 AM vii  About the Authors

Robin Bade was an undergraduate at the University of Queensland, Australia, where she earned degrees in mathematics and economics. After a spell teaching high school math and physics, she enrolled in the Ph.D. program at the Australian National University, from which she graduated in 1970. She has held faculty appointments at the University of Edinburgh in Scotland, at Bond ­University in Australia, and at the Universities of Manitoba, Toronto, and West- ern Ontario in Canada. Her research on international capital flows appears in the International Economic Review and the Economic Record. Robin first taught the principles of economics course in 1970 and has taught it (alongside intermediate macroeconomics and international trade and finance) most years since then. She developed many of the ideas found in this text while conducting tutorials with her students at the University of Western Ontario.

Michael Parkin studied economics in England and began his ­university teaching career immediately after graduating with a B.A. from the University of Leicester. He learned the subject on the job at the University of ­Essex, England’s most exciting new university of the 1960s, and at the age of 30 became one of the youngest full professors. He is a past president of the Canadian Economics Association and has served on the editorial boards of the American Economic Review and the Journal of Monetary Economics. His research on macroeconomics, monetary economics, and international economics has resulted in more than 160 publications in journals and edited volumes, including the American Economic Review, the Journal of Political Economy, the Review of Economic Studies, the Journal of Monetary Economics, and the Journal of Money, Credit, and Banking. He is author of the best-selling textbook, Economics (Pearson), now in its Thirteenth Edition.

Robin and Michael are a wife-and-husband team. Their most notable joint ­research created the Bade-Parkin Index of central bank independence and spawned a vast amount of research on that topic. They don’t claim credit for the independence of the new European Central Bank, but its constitution and the movement toward greater independence of central banks around the world were aided by their pioneering work. Their joint textbooks include Macroeco- nomics (Prentice Hall), Modern Macroeconomics (Pearson Education Canada), and Economics: Canada in the Global Environment, the Canadian adaptation of Parkin, Economics (Pearson). They are dedicated to the challenge of explaining econom- ics ever more clearly to a growing body of students. Music, the theater, art, walking on the beach, and five grandchildren ­provides their relaxation and fun.

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PART 1 INTRODUCTION 1 Getting Started 1 2 The U.S. and Global Economies 35 3 The Economic Problem 61 4 Demand and Supply 85 PART 2 A CLOSER LOOK AT MARKETS 5 Elasticities of Demand and Supply 115 6 Efficiency and Fairness of Markets 141 PART 3 HOW GOVERNMENTS INFLUENCE THE ECONOMY 7 Government Actions in Markets 171 8 Taxes 193 9 Global Markets in Action 217 PART 4 MARKET FAILURE AND PUBLIC POLICY 10 Externalities 247 11 Public Goods and Common Resources 271 12 Private Information and Healthcare Markets 297 PART 5 A CLOSER LOOK AT DECISION MAKERS 13 Consumer Choice and Demand 321 14 Production and Cost 349 PART 6 PRICES, PROFITS, AND INDUSTRY PERFORMANCE 15 Perfect Competition 377 16 Monopoly 405 17 Monopolistic Competition 437 18 Oligopoly 461

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PART 7 INCOMES AND INEQUALITY 19 Markets for Factors of Production 489 20 Economic Inequality 513 Glossary G-1 Index I-1 Credits C-1

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PART 1 INTRODUCTION

Appendix: Making and Using Graphs 25 CHAPTER 1 Basic Idea 25 Getting Started 1 Interpreting Data Graphs 26 CHAPTER CHECKLIST 1 Interpreting Graphs Used in Economic Models 28 The Slope of a Relationship 31 1.1 Definition and Questions 2 Relationships Among More Than Two Variables 32 Scarcity 2 APPENDIX CHECKPOINT 34 Economics Defined 2 ■ EYE on the BENEFIT AND COST OF SCHOOL What, How, and For Whom? 3 Did You Make the Right Decision? 12 Can the Pursuit of Self-Interest Be in the Social ­Interest? 4 ■ EYE on YOUR LIFE CHECKPOINT 1.1 7 Your Time Allocation 19 1.2 The Economic Way of Thinking 8 ■ EYE on the PAST A Choice Is a Tradeoff 8 Adam Smith and the Birth of Economics as a Social Cost: What You Must Give Up 8 Science 20 Benefit: What You Gain 9 Rational Choice 9 How Much? Choosing at the Margin 10 Choices Respond to Incentives 11 CHECKPOINT 1.2 13 CHAPTER 2 1.3 Economics as a Social Science and Policy The U.S. and Global Economies 35 Tool 14 CHAPTER CHECKLIST 35 Economics as a Social Science 14 Economics as a Policy Tool 15 2.1 What, How, and for Whom? 36 CHECKPOINT 1.3 15 What Do We Produce? 36 How Do We Produce? 38 1.4 ECONOMICS AS A LIFE SKILL AND JOB SKILL 16 For Whom Do We Produce? 41 Jobs for an Economics Major 16 CHECKPOINT 2.1 42 Will the Number of Economics Jobs Grow? 17 How Much Do Economics Majors Earn? 17 2.2 The Global Economy 43 Skills Needed for Economics Jobs 17 The People 43 Economics for Life 18 The Economies 43 CHECKPOINT 1.4 20 What in the Global Economy 44 How in the Global Economy 46 CHAPTER SUMMARY 21 For Whom in the Global Economy 46 CHAPTER CHECKPOINT 22 CHECKPOINT 2.2 49

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2.3 The Circular Flows 50 Opportunity Cost Is a Ratio 69 Households and Firms 50 Increasing Opportunity Costs Are Markets 50 Everywhere 70 Real Flows and Money Flows 50 Your Increasing Opportunity Cost 70 Governments 52 CHECKPOINT 3.2 71 Governments in the Circular Flow 53 3.3 Economic Growth 72 Circular Flows in the Global Economy 54 CHECKPOINT 3.3 74 CHECKPOINT 2.3 56 3.4 Specialization and Trade 75 CHAPTER SUMMARY 57 Absolute Advantage and Comparative CHAPTER CHECKPOINT 58 Advantage 75 Comparative Advantage: A Model 76 ■ EYE on the U.S. ECONOMY Achieving Gains from Trade 78 What We Produce 37 The Economy’s Production Possibilities ■ EYE on the PAST Frontier 79 Changes in What We Produce 38 CHECKPOINT 3.4 80 ■ EYE on the U.S. ECONOMY CHAPTER SUMMARY 81 Changes in How We Produce in the Information Economy 40 CHAPTER CHECKPOINT 82 ■ EYE on the DREAMLINER ■ EYE on YOUR LIFE Who Makes the Dreamliner? 45 Your Production Possibilities Frontier 66 ■ EYE on the GLOBAL ECONOMY ■ EYE on the ENVIRONMENT Differences in How We Produce 47 Is Wind Power Free? 70 ■ EYE on YOUR LIFE ■ EYE on the U.S. ECONOMY The U.S. and Global Economies in Your Life 49 Expanding Our Production Possibilities 73 ■ EYE on the PAST ■ EYE on the GLOBAL ECONOMY Growing Government 54 Hong Kong’s Rapid Economic Growth 74 ■ EYE on the GLOBAL ECONOMY ■ EYE on the U.S. ECONOMY The Ups and Downs in International Trade 56 No One Knows How to Make a Pencil 75 ■ EYE on YOUR LIFE Your Comparative Advantage 79 CHAPTER 3 The Economic Problem 61 CHAPTER CHECKLIST 61

3.1 Production Possibilities 62 CHAPTER 4 Production Possibilities Frontier 62 Demand and Supply 85 How the PPF Illustrates Scarcity and Its CHAPTER CHECKLIST 85 ­Consequences 63 CHECKPOINT 3.1 67 Competitive Markets 86 3.2 Opportunity Cost 68 4.1 Demand 87 The Opportunity Cost of a Smartphone 68 The Law of Demand 87 Opportunity Cost and the Slope of the PPF 69 Demand Schedule and Demand Curve 87

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Individual Demand and Market Demand 89 Predicting Price Changes: Three Questions 103 Changes in Demand 90 Effects of Changes in Demand 104 Change in Quantity Demanded Versus Change in Effects of Changes in Supply 106 ­Demand 92 Effects of Changes in Both Demand and CHECKPOINT 4.1 93 Supply 108 CHECKPOINT 4.3 110 4.2 Supply 94 The Law of Supply 94 CHAPTER SUMMARY 111 Supply Schedule and Supply Curve 94 CHAPTER CHECKPOINT 112 Individual Supply and Market Supply 96 Changes in Supply 97 ■ EYE on YOUR LIFE Change in Quantity Supplied Versus Change in Understanding and Using Demand and Supply 100 ­Supply 99 ■ EYE on the GLOBAL ECONOMY CHECKPOINT 4.2 101 The Markets for Cocoa and Chocolate 105 4.3 Market Equilibrium 102 ■ EYE on the PRICE OF AVOCADOS Price: A Market’s Automatic Regulator 102 Why Does the Price of Avocados Fluctuate? 107

PART 2 A CLOSER LOOK AT MARKETS

Influences on the Price Elasticity of Supply 128 CHAPTER 5 Computing the Price Elasticity of Supply 130 Elasticities of Demand CHECKPOINT 5.2 132 and Supply 115 5.3 Cross Elasticity and Income CHAPTER CHECKLIST 115 Elasticity 133 Cross Elasticity of Demand 133 5.1 The Price Elasticity of Demand 116 Income Elasticity of Demand 134 Percentage Change in Price 116 CHECKPOINT 5.3 136 Percentage Change in Quantity Demanded 117 Comparing the Percentage Changes in Price CHAPTER SUMMARY 137 and Quantity 117 CHAPTER CHECKPOINT 138 Elastic and Inelastic Demand 118 Influences on the Price Elasticity of ■ EYE on the GLOBAL ECONOMY Demand 118 Price Elasticities of Demand 123 Computing the Price Elasticity of Demand 120 ■ EYE on ELASTICITY AT THE COFFEE SHOP Interpreting the Price Elasticity of Demand What Do You Do When Starbucks Raises the Price ­Number 121 of a Latte? 125 Elasticity Along a Linear Demand Curve 122 Total Revenue and the Price Elasticity of ■ EYE on the U.S. ECONOMY Demand 124 Two Applications of the Price Elasticity of Demand 126 CHECKPOINT 5.1 127 ■ EYE on YOUR LIFE 5.2 The Price Elasticity of Supply 128 Your Price Elasticities of Demand 135 Elastic and Inelastic Supply 128

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Total Surplus Is Maximized 157 CHAPTER 6 The Invisible Hand 157 Efficiency and Fairness Market Failure 159 of Markets 141 Sources of Market Failure 160 CHAPTER CHECKLIST 141 Alternatives to the Market 161 CHECKPOINT 6.4 163 6.1 Allocation Methods and Efficiency 142 6.5 Are Markets Fair? 164 Resource Allocation Methods 142 It’s Not Fair If the Rules Aren’t Fair 164 Using Resources Efficiently 145 It’s Not Fair If the Result Isn’t Fair 164 CHECKPOINT 6.1 149 Compromise 165 6.2 Value, Price, and Consumer CHECKPOINT 6.5 166 Surplus 150 CHAPTER SUMMARY 167 Demand and Marginal Benefit 150 Consumer Surplus 151 CHAPTER CHECKPOINT 168 CHECKPOINT 6.2 152 ■ EYE on the U.S. ECONOMY 6.3 Cost, Price, and Producer Surplus 153 The Invisible Hand and e-Commerce 158 Supply and Marginal Cost 153 ■ EYE on TICKET SCALPING Producer Surplus 154 Should Ticket Scalping Be Illegal? 162 CHECKPOINT 6.3 155 ■ EYE on YOUR LIFE 6.4 Are Markets Efficient? 156 Allocation Methods, Efficiency, and Fairness 165 Marginal Benefit Equals Marginal Cost 156

PART 3 HOW GOVERNMENTS INFLUENCE THE ECONOMY

7.2 Price Floors 178 CHAPTER 7 The Minimum Wage 179 Government Actions Is the Minimum Wage Efficient? 182 in Markets 171 Is the Minimum Wage Fair? 183 CHAPTER CHECKLIST 171 If the Minimum Wage Is So Bad, Why Do We Have It? 183 7.1 Price Ceilings 172 CHECKPOINT 7.2 184 A Rent Ceiling 172 7.3 Production Quotas 185 Are Rent Ceilings Efficient? 175 Production Quota: An Example 185 Are Rent Ceilings Fair? 176 CHECKPOINT 7.3 If Rent Ceilings Are So Bad, Why Do We 188 Have Them? 176 CHAPTER SUMMARY 189 CHECKPOINT 7.1 177 CHAPTER CHECKPOINT 190

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■ EYE on the U.S. ECONOMY ■ EYE on the U.S. ECONOMY Minimum Wages and Employment 181 Taxes in the United States Today 201 ■ EYE on PRICE REGULATION ■ Eye on CONGRESS Can Governments Repeal the Law of Market Does Congress Decide Who Pays the Taxes? 205 Forces? 183 ■ EYE on the PAST ■ EYE on the GLOBAL ECONOMY The Origins and History of the U.S. Production Quotas 185 Income Tax 206 ■ EYE on YOUR LIFE ■ EYE on YOUR LIFE Price Ceilings and Price Floors You Encounter 187 Tax Freedom Day 206 ■ EYE on the U.S. ECONOMY The Progressive Income Tax 210 CHAPTER 8 Taxes 193 CHAPTER 9 CHAPTER CHECKLIST 193 Global Markets in Action 217 8.1 Taxes on Buyers and Sellers 194 CHAPTER CHECKLIST 217 Tax Incidence 194 Taxes and Efficiency 195 9.1 How Global Markets Work 218 Tax Burden 196 International Trade Today 218 Incidence, Inefficiency, and Elasticity 196 What Drives International Trade? 218 Incidence, Inefficiency, and the Elasticity of Why the United States Imports T-Shirts 220 Demand 197 Why the United States Exports Airplanes 221 Incidence, Inefficiency, and the Elasticity of CHECKPOINT 9.1 222 Supply 198 9.2 Winners, Losers, and Net Gains From CHECKPOINT 8.1 199 Trade 223 8.2 Income Taxes and Social Security Gains and Losses from Imports 224 Taxes 200 Gains and Losses from Exports 225 The Effects of the Income Tax 200 CHECKPOINT 9.2 226 The Social Security Tax 204 9.3 International Trade Restrictions 227 CHECKPOINT 8.2 207 Tariffs 227 8.3 Fairness and the Big Tradeoff 208 Import Quotas 232 The Benefits Principle 208 Other Import Barriers 234 The Ability-to-Pay Principle 208 Export Subsidies 234 Ability to Pay and Tax Progressivity 209 CHECKPOINT 9.3 236 The Big Tradeoff and Alternative Tax 9.4 The Case Against Protection 237 Proposals 209 Three Traditional Arguments for Protection 237 CHECKPOINT 8.3 212 Four Newer Arguments for Protection 239 CHAPTER SUMMARY 213 Why Is International Trade Restricted? 240 CHECKPOINT 9.4 242 CHAPTER CHECKPOINT 214

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CHAPTER SUMMARY 243 ■ EYE on the U.S. ECONOMY A Tariff on Softwood Lumber 231 CHAPTER CHECKPOINT 244 ■ EYE on the U.S. ECONOMY ■ EYE on the U.S. ECONOMY An Import Quota on Sugar 235 U.S. Exports and Imports 219 ■ EYE on YOUR LIFE ■ Eye on GLOBALIZATION International Trade 241 Who Wins and Who Loses from Globalization? 223 ■ EYE on the PAST The History of U.S. Tariffs 227

PART 4 MARKET FAILURE AND PUBLIC POLICY

■ EYE on YOUR LIFE CHAPTER 10 Externalities in Your Life 249 Externalities 247 ■ EYE on the U.S. ECONOMY CHAPTER CHECKLIST 247 U.S. Air Pollution Trends 257 ■ EYE on CLIMATE CHANGE Externalities in our Daily Lives 248 How Can We Limit Carbon Emissions? 258 Negative Production Externalities 248 Positive Production Externalities 248 Negative Consumption Externalities 249 Positive Consumption Externalities 249 CHAPTER 11 10.1 Negative Externalities: Pollution 250 Public Goods and Common Private Costs and Social Costs 250 Production and Pollution: How Much? 252 Resources 271 Property Rights 253 CHAPTER CHECKLIST 271 Command-and-Control Regulation 255 Pollution Taxes 255 11.1 Classifying Goods and Resources 272 Cap-and-Trade 256 Excludable 272 CHECKPOINT 10.1 260 Rival 272 A Fourfold Classification 272 10.2 Positive Externalities: Education 261 CHECKPOINT 11.1 274 Private Benefits and Social Benefits 261 Government Actions in the Face of External Benefits 263 11.2 Public Goods and The Free-Rider CHECKPOINT 10.2 266 Problem 275 The Free-Rider Problem 275 CHAPTER SUMMARY 267 The Marginal Benefit of a Public Good 276 CHAPTER CHECKPOINT 268 The Marginal Cost of a Public Good 276 The Efficient Quantity of a Public Good 278

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Private Provision: Underproduction 278 12.1 The Lemons Problem and its Public Provision: Efficient Production 279 Solution 298 Obstacles to Efficient Public Provision 280 A Market for Used Cars with a Lemons CHECKPOINT 11.2 283 Problem 298 A Used-Car Market with Dealers’ 11.3 The Tragedy of The Commons 284 Warranties 300 Unsustainable Use of a Common Resource 284 CHECKPOINT 12.1 302 Inefficient Use of a Common Resource 285 Using the Commons Efficiently 288 12.2 Information Problems in Insurance CHECKPOINT 11.3 292 Markets 303 Insurance Markets 303 CHAPTER SUMMARY 293 Asymmetric Information in Insurance 304 CHAPTER CHECKPOINT 294 Screening in Insurance Markets 306 Separating Equilibrium with Screening 306 ■ EYE on the PAST CHECKPOINT 12.2 308 Is a Lighthouse a Public Good? 274 ■ EYE on YOUR LIFE 12.3 The Economics of Healthcare 309 Healthcare Market Failure 309 A Student’s Free-Rider Problem and a Market Alternative Public Choice Solutions 312 Solution 275 A Reform Idea? 314 ■ EYE on the U.S. INFRASTRUCTURE CHECKPOINT 12.3 316 Should America Spend More on Transportation Infrastructure? 282 CHAPTER SUMMARY 317 ■ EYE on the PAST CHAPTER CHECKPOINT 318 The Commons of England’s Middle Ages 284 ■ EYE on the GLOBAL ECONOMY ■ EYE on the MARKET FOR USED CARS The North Atlantic Cod Tragedy of the How Do You Avoid Buying a Lemon? 300 Commons 286 ■ EYE on the U.S. ECONOMY ■ EYE on the GLOBAL ECONOMY Insurance in the United States 303 ITQs Work 291 ■ EYE on the U.S. ECONOMY Healthcare in the United States: A Snapshot 310 ■ EYE on the GLOBAL ECONOMY CHAPTER 12 Healthcare Expenditures and Health Private Information Outcomes 313 and Healthcare Markets 297 ■ EYE on YOUR LIFE Signaling Your Ability 315 CHAPTER CHECKLIST 297

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PART 5 A CLOSER LOOK AT DECISION MAKERS

■ EYE on YOUR LIFE CHAPTER 13 Do You Maximize Your Utility? 338 Consumer Choice and Demand 321 CHAPTER CHECKLIST 321 CHAPTER 14 Production and Cost 349 13.1 Consumption Possibilities 322 CHAPTER CHECKLIST 349 The Budget Line 322 A Change in the Budget 323 14.1 Economic Cost and Profit 350 Changes in Prices 324 The Firm’s Goal 350 Prices and the Slope of the Budget Line 325 Accounting Cost and Profit 350 CHECKPOINT 13.1 327 Opportunity Cost 350 13.2 Marginal Utility Theory 328 Economic Profit 351 Total Utility 328 CHECKPOINT 14.1 353 Marginal Utility 328 Short Run and Long Run 354 Graphing Tina’s Utility Schedules 330 Maximizing Total Utility 330 14.2 Short-Run Production 355 Finding an Individual Demand Curve 332 Total Product 355 CHECKPOINT 13.2 334 Marginal Product 356 Average Product 358 13.3 Efficiency, Price, and Value 335 CHECKPOINT 14.2 360 Consumer Efficiency 335 The Paradox of Value 335 14.3 Short-Run Cost 361 CHECKPOINT 13.3 338 Total Cost 361 Marginal Cost 362 CHAPTER SUMMARY 339 Average Cost 363 Why the Average Total Cost Curve Is U-Shaped 365 CHAPTER CHECKPOINT 340 Cost Curves and Product Curves 366 Shifts in the Cost Curves 366 Appendix: Indifference Curves 343 An Indifference Curve 343 CHECKPOINT 14.3 368 Marginal Rate of Substitution 344 14.4 Long-Run Cost 369 Consumer Equilibrium 345 Plant Size and Cost 369 Deriving the Demand Curve 346 The Long-Run Average Cost Curve 370 APPENDIX CHECKPOINT 348 CHECKPOINT 14.4 372 ■ EYE on the U.S. ECONOMY Relative Prices on the Move 326 CHAPTER SUMMARY 373 ■ EYE on the PAST CHAPTER CHECKPOINT 374 Jeremy Bentham, William Stanley Jevons, ■ EYE on YOUR LIFE and the Birth of Utility 329 Your Average and Marginal Grades 359 ■ EYE on SONG DOWNLOADS AND ■ EYE on RETAILERS’ COSTS STREAMING Which Store Has the Lower Costs: Walmart or How Much Would You Pay for a Song? 336 7-Eleven? 371

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PART 6 PRICES, PROFITS, AND INDUSTRY PERFORMANCE CHAPTER 16 CHAPTER 15 Monopoly 405 Perfect Competition 377 CHAPTER CHECKLIST 405 CHAPTER CHECKLIST 377 16.1 Monopoly and How it Arises 406 Market Types 378 No Close Substitute 406 Perfect Competition 378 Barrier to Entry 406 Other Market Types 378 Monopoly Price-Setting Strategies 408 15.1 A Firm’s Profit-Maximizing Choices 379 CHECKPOINT 16.1 409 Price Taker 379 16.2 Single-Price Monopoly 410 Revenue Concepts 379 Price and Marginal Revenue 410 Profit-Maximizing Output 380 Marginal Revenue and Elasticity 411 Marginal Analysis and the Supply Decision 382 Output and Price Decision 412 Temporary Shutdown Decision 383 The Firm’s Short-Run Supply Curve 384 CHECKPOINT 16.2 414 CHECKPOINT 15.1 386 16.3 Monopoly and Competition 15.2 Output, Price, and Profit In The Short Compared 415 Output and Price 415 Run 387 Is Monopoly Efficient? 416 Market Supply in the Short Run 387 Is Monopoly Fair? 417 Short-Run Equilibrium in Normal Times 388 Rent Seeking 417 Short-Run Equilibrium in Good Times 389 Short-Run Equilibrium in Bad Times 390 CHECKPOINT 16.3 419 CHECKPOINT 15.2 391 16.4 Price Discrimination 420 15.3 Output, Price, and Profit In The Long Price Discrimination and Consumer Surplus 420 Profiting by Price Discriminating 421 Run 392 Perfect Price Discrimination 422 Entry and Exit 393 Price Discrimination and Efficiency 424 The Effects of Exit 394 Change in Demand 395 CHECKPOINT 16.4 425 Technological Change 395 16.5 Monopoly Regulation 426 Is Perfect Competition Efficient? 398 Efficient Regulation of a Natural Monopoly 426 Is Perfect Competition Fair? 399 Second-Best Regulation of a Natural CHECKPOINT 15.3 400 Monopoly 427 CHECKPOINT 16.5 432 CHAPTER SUMMARY 401 CHAPTER SUMMARY 433 CHAPTER CHECKPOINT 402 CHAPTER CHECKPOINT 434 ■ EYE on RECORD STORES Where Have All the Record Stores Gone? 396 ■ EYE on the U.S. ECONOMY ■ EYE on YOUR LIFE Information-Age Monopolies 408 The Perfect Competition That You Encounter 399 ■ EYE on the U.S. ECONOMY Airline Price Discrimination 424

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■ EYE on MICROSOFT CHAPTER Are Microsoft’s Prices Too High? 429 18 Oligopoly 461 ■ EYE on YOUR LIFE Monopoly in Your Everyday Life 430 CHAPTER CHECKLIST 461

18.1 What is Oligopoly? 462 Small Number of Firms 462 Barriers to Entry 462 CHAPTER 17 Identifying Oligopoly 464 Monopolistic Competition 437 CHECKPOINT 18.1 465 CHAPTER CHECKLIST 437 18.2 The Oligopolists’ Dilemma 466 Monopoly Outcome 466 17.1 What is Monopolistic Competition? 438 Perfect Competition Outcome 467 Describing Monopolistic Other Possible Cartel Breakdowns 467 Competition 438 The Oligopoly Cartel Dilemma 468 Identifying Monopolistic Competition 439 CHECKPOINT 18.2 470 CHECKPOINT 17.1 443 18.3 Game Theory 471 17.2 Output and Price Decisions 444 What Is a Game? 471 The Firm’s Profit-Maximizing The Prisoners’ Dilemma 471 Decision 444 The Duopolists’ Dilemma 473 Profit Maximizing Might Be Loss The Payoff Matrix 473 Minimizing 445 Advertising and Research Games in Oligopoly 474 Long Run: Zero Economic Profit 446 Repeated Games 476 Monopolistic Competition and Perfect Is Oligopoly Efficient? 477 Competition 447 CHECKPOINT 18.3 478 Is Monopolistic Competition Efficient? 448 18.4 Antitrust Law 479 CHECKPOINT 17.2 449 The Antitrust Laws 479 Three Antitrust Policy Debates 479 17.3 Innovation and Advertising 450 Recent Antitrust Showcase: The United States Versus Design and Quality Decision 450 Microsoft 481 Advertising 450 Merger Rules 482 The Demand for Advertising 451 CHECKPOINT 18.4 484 The Supply of Advertising 455 Equilibrium and Efficiency in the Advertising CHAPTER SUMMARY 485 Market 455 CHAPTER CHECKPOINT 486 CHECKPOINT 17.3 456 CHAPTER SUMMARY 457 ■ EYE on the U.S. ECONOMY Examples of Oligopoly 464 CHAPTER CHECKPOINT 458 ■ EYE on the GLOBAL ECONOMY ■ EYE on the U.S. ECONOMY The OPEC Global Oil Cartel 469 Examples of Monopolistic Competition 442 ■ EYE on YOUR LIFE ■ EYE on SMARTPHONES A Game You Might Play 476 Which Smartphone? 453 ■ EYE on the WIRELESS OLIGOPOLY ■ EYE on YOUR LIFE Is Three Too Few? 477 Some Selling Costs You Pay 454 ■ EYE on the U.S. ECONOMY Wireless Service Merger Decisions 483

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PART 7 INCOMES AND INEQUALITY

CHAPTER 19 CHAPTER 20 Markets for Factors of Economic Inequality 513 Production 489 CHAPTER CHECKLIST 513 CHAPTER CHECKLIST 489 20.1 Measuring Economic Inequality 514 The Anatomy of Factor Markets 490 Lorenz Curves 515 19.1 The Demand for A Factor of Inequality over Time 516 Production 491 Poverty 517 Value of Marginal Product 491 Economic Mobility 518 A Firm’s Demand for Labor 492 CHECKPOINT 20.1 521 A Firm’s Demand for Labor Curve 493 20.2 How Economic Inequality Arises 522 Changes in the Demand for Labor 494 Human Capital 522 CHECKPOINT 19.1 495 Discrimination 525 19.2 Labor Markets 496 Financial and Physical Capital 526 The Supply of Labor 496 Entrepreneurial Ability 526 Influences on the Supply of Labor 497 Personal and Family Characteristics 526 Competitive Labor Market Equilibrium 498 CHECKPOINT 20.2 527 Labor Unions 500 20.3 Income Redistribution 528 CHECKPOINT 19.2 502 How Governments Redistribute Income 528 19.3 Capital and Natural Resource The Scale of Income Redistribution 529 Markets 503 Why We Redistribute Income 531 Capital Markets 503 The Major Welfare Challenge 532 Land Markets 504 CHECKPOINT 20.3 534 Nonrenewable Natural Resource CHAPTER SUMMARY 535 Markets 505 CHECKPOINT 19.3 508 CHAPTER CHECKPOINT 536 CHAPTER SUMMARY 509 ■ EYE on the GLOBAL ECONOMY Global Inequality 519 CHAPTER CHECKPOINT 510 ■ Eye on INEQUALITY ■ EYE on the COACH Who Are the Rich and the Poor? 520 Why Is a Coach Worth $8.3 Million? 499 ■ EYE on the U.S. ECONOMY ■ EYE on YOUR LIFE Does Education Pay? 524 Job Choice and Income Prospects 501 ■ EYE on the U.S. ECONOMY ■ EYE on the GLOBAL ECONOMY Sex and Race Earnings Differences 525 Oil and Metal Prices 506 ■ EYE on YOUR LIFE What You Pay and Gain Through Redistribution 533

Glossary G-1 Index I-1 Credits C-1

A01_BADE7725_09_SE_FM.indd 21 12/18/19 2:54 AM A01_BADE7725_09_SE_FM.indd 22 12/18/19 2:54 AM FOUNDATIONS OF MICROECONOMICS delivers a complete, hands-on learning system designed around active learning.

A Learning-by-Doing Approach

The Checklist that begins each chapter highlights the key topics covered and the chapter is divided into sections that directly correlate to the Checklist. Why does the price of avocados uctuate? The Checkpoint that ends each section provides a full page of practice problems to encourage students to review the material 4 while it is fresh in their minds. Demand and Supply When you have completed your study of this chapter, CHAPTER CHECKLIST Each chapter opens with a question about you will be able to 1 Distinguish between quantity demanded and demand, and explain a central issue that sets the stage for the what determines demand. material. 2 Distinguish between quantity supplied and supply, and explain what determines supply. 3 Explain how demand and supply determine price and quantity in a market, and explain the e ects of changes in demand and supply.

CHECKPOINT 4.1

Distinguish between quantity demanded and demand, and explain what determines demand. Practice Problems The following events occur one at a time in the market for smartphones: • The price of a smartphone falls. • Producers announce that the price of a smartphone will fall next month. EYE on the PRICE OF AVOCADOS • The price of a call made from a smartphone falls. • The price of a call made from a land-line phone increases. Why Does the Price of Avocados Fluctuate? • An increase in memory makes smartphones more popular. In August each year, the Californian avo- Yo u can answer this question from avocados, which we will assume was 1. Explain the e ect of each event on the demand for smartphones. cado crop winds down and the Mexican the information provided. Yo u know the same in both months. 2. Use a graph to illustrate the e ect of each event. crop takes over. But if Mexican produc- that an increase in demand brings a At the end of July, the supply 3. Does any event (or events) illustrate the law of demand? tion is not ramped up enough to replace rise in the price and an increase in the curve was SJul, the equilibrium price the Californian crop, the quantity of quantity traded, while a decrease in was $1.03 per avocado, and the equi- In the News avocados produced decreases and the supply brings a rise in the price and a librium quantity of avocados was 48 Netflix hikes its price price rises. decrease in the quantity traded. million pounds. The table below provides some data Because the quantity of avoca- During August, decreased produc- on the quantity and price of avocados at dos bought decreased and the price tion in California decreased supply to the end of July 2018 and the start of Sep- increased, the supply of avocados must SSep by the start of September. Eye On boxes apply theory to ■ FIGUREtember 4.4 2018. What do the data tell us? have decreased. The equilibrium price rose to important issues and problems Change inThe Quantity data tell us Demandedthat the quantity Versus ChangeThe inf inormation Demand that Californian $1.29 per avocado and the equilib- of avocados produced decreased by production wound down before Mexi- rium quantity decreased to 36 million that shape our global society and A decrease25 perin thcente from 48 million pounds in July cian production fully ramped up tells pounds.An increase in the quantity todemande 36 milliond pounds in SeptembePrice (dollarsr, and per bottle)us that avocado production decreased, quantityThe higher demande price broughtd a de- individual decisions. The quantitythe demanded price rose decr by ease25 pers cent2.50 from $1.03 which decreased the supply. creaseThe quantity in the quantity demanded of avincocareasedoss and there isto a $1.29movement per av upoca alondog. The figure illustrates the market demanded,and there whichis a mo isvement shown do bywn the the demand cuDidrve the D0 ifprice the pricrisee because the demand for avocados during 2018. The de- moalongvement the demandup along cu therve demand D0 if of the goodinc risesreased and or other because thing thes supp2.00ly decreased? mand curve D shows the demand for curtheve .price of the good falls and Confidence-Building Graphs remain the same. other things remain the same. use color to show the direction of shifts and A decrease in demand An increase in demand Demand decreases and the 1.50 Demand increases and the detailed, numbered captions guide students demand curve shifts leftward demand curve shifts rightward (from D01 to D ) if (from D02 to D ) if step-by-step through the action. The price of a substitute 1.00 The price of a substitute falls or the price of a rises or the price of a complement rises. D2 complement falls. The price of the good is The price of the good is 0.50 expected to fall. D0 expected to rise. Income decreases.* Income increases. D Expected future income 1 Expected future income or credit decreases. or credit increases. 0 89110 12131 The number of buyers The number of buyers Quantity (millions of bottles per day) decreases. increases. * Bottled water is a normal good.

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Students know that throughout their lives they will make economic decisions and be influenced by economic forces. They want to understand the economic principles that can help them navigate these forces and guide their decisions. Foundations­ of Microeconomics is our attempt to satisfy this want. The response to our earlier editions from hundreds of colleagues across the United States and throughout the world tells us that most of you agree with our view that the principles course must do four things well. It must • Motivate with compelling issues and questions • Focus on core ideas • Steer a path between an overload of detail and too much left unsaid • Encourage and aid learning by doing

The Foundations icon with its four blocks (on the cover and throughout the book) symbolizes this four-point approach that has guided all our choices in writing this text and creating its comprehensive teaching and learning features.

WHAT’S NEW IN THE NINTH EDITION

New in this Ninth Edition revision are: Fine-tuning of the content; several notable content changes in micro and macro; an emphasis on economics as a foundation for effective citizenship; and highlighting the role of economics as a life skill and a job skill.

Fine-Tuning the Content The content of this revision is driven by the drama of the extraordinary period of economic history in which we are living and its rich display of events and forces through which students can be motivated to discover the economic way of thinking. Persistent slow economic growth; increasing concentration of wealth; headwinds from Europe’s stagnant economy and the UK decision to leave the economic union (Brexit); ongoing tensions arising from the loss of American jobs to offshore outsourcing and the political popularity of trade protection; a slowing pace of China’s expansion; enhanced concern about carbon emission and climate change; relentless pressure on the federal budget from the demands of an aging

xxv

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population and a sometimes dysfunctional Congress with its associated rising government debt; the dilemma posed by slow, more than decade-long recovery from a global financial crisis and recession and the related question of when and how fast to exit an era of extreme monetary stimulus. These are just a few of these interest-arousing events. All of them feature at the appropriate points in our new edition. Every chapter contains many small changes, all designed to enhance clar- ity and currency, and the text and examples are all updated to reflect the most recently available data and events.

Notable Content Changes in Micro In Chapter 1, Getting Started, we have expanded and reorganized our explana- tion of economics as a social science and as a policy decision tool. And we have broadened our explanation of how economics is used as an aid to critical think- ing and a job tool. In a new section, Economics as a Life Skill and Job Skill, we describe the jobs that economics majors do and the incomes they earn. In Chapter 4, Demand and Supply, we explain and illustrate the power of the demand-supply model to predict and explain large recent swings in the price of avocados. In Chapter 6, Efficiency and Fairness of Markets, we have replaced a discus- sion of gouging with a new exploration of the efficiency and fairness of ticket ­scalping. In Chapter 9, Global Markets in Action, provides the student with the tools needed to evaluate the Trump upheaval of global trade and illustrates the effects of protection by examining U.S. tariffs on Canadian softwood imports and the U.S. import quota on sugar. In Chapter 10, Externalities, we have expanded our discussion of externalites in everyday life with compelling current examples. And we have revised and improved our coverage of policies for dealing with carbon emissions and the global challenge of achieving an efficient use of energy resources. We describe command-and-control proposals like the Green New Deal and explain why economists favor pricing and taxing emissions. In Chapter 12, Private Information and Healthcare Markets, we have com- pressed our coverage of the lemons problem and updated coverage of the eco- nomics of healthcare insurance and services. In Chapter 13, Consumer Choice and Demand, we have rewritten our expla- nation of how online music delivery captures consumer surplus and how stream- ing services take even more consumer surplus than song downloads did. In Chapter 16, Monopoly, we have updated our discussion of information-age monopolies. In Chapter 18, Oligopoly, we have updated our examination of wireless oligop- olies and the decision around a wireless service merger.

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THE FOUNDATIONS VISION

Focus on Core Concepts Each chapter of Foundations concentrates on a manageable number of main ideas (most commonly three or four) and reinforces each idea several times throughout the chapter. This patient, confidence-building approach guides students through unfamiliar terrain and helps them to focus their efforts on the most important tools and concepts of our discipline.

Showing the Action and Telling the Whole Story Through earlier editions, we have developed the style of our diagrams and set the standard of their clarity. The ninth edition continues to uphold this tradi- tion. Our goal is to show “where the economic action is.” Our diagrams continue to generate an enormously positive response, which confirms our view that graphical analysis is the most powerful tool available for teaching and learning economics at the principles level. Recognizing that some students find graphs hard to work with, we have developed the entire art program with the study and review needs of the student in mind. Because beginning students of economics are often apprehensive about ­working with graphs, we have made a special effort to present the information in as many as three ways—with graphs, words, and tables—in the same figure. In an innovation that seems necessary, but is to our knowledge unmatched, nearly all of the information supporting a figure appears on the same page as the figure itself. No more flipping pages back and forth!

Real-World Connections That Bring Theory to Life Students learn best when they can see the purpose of what they are studying, ­apply it to illuminate the world around them, and use it in their lives. Eye On boxes offer fresh new examples to help students see that economics is everywhere. Current and recent events appear in Eye on the U.S. Economy boxes; we place current U.S. economic events in global and historical perspectives in our Eye on the Global Economy and Eye on the Past boxes; and we show how students can use economics in day-to-day decisions in Eye on Your Life boxes. Each chapter-opening question is answered in an Eye On box that helps students see the economics behind a key issue facing the world and highlights a major aspect of the chapter's story.

Foundation for Job and Life A centerpiece of the Foundations vision is enabling the principles of economics course to prepare the student for a productive career and life. It identifies three skills that further this goal: • Problem solving • Critical thinking • Decision making Problem solving is central to the Foundations story. A Checkpoint at the end of each topic, typically three per chapter, provides a pause and oppor- tunity to check understanding with problems, one of which is driven by a recent news clip, and worked solutions.

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Critical thinking is encouraged and supported through a series of exercises. In each chapter, there is one exercise that is based on the question or issue that opens and motivates the chapter, and a second that builds from an Economics in Your Life feature. Decision making is at the core of economics, and the principles course, with its emphasis on choice at the margin and opportuntiy cost, teaches decision-making skills like no other subject.

Foundation for Effective Citizenship An effective citizen is a person who participates in the public conversation and votes in elections with a solid sense of the efficiency and fairness of alternative public, collective decisions. This text lays the foundation for effective citizenship by explaining the principles of welfare economics and the competing ideas about fairness, and repeatedly applying these principles to a comprehensive range of public choice problems. And our Economics in Your Life feature connects these principles with the student's own life and public choices.

ORGANIZATION

We have organized the sequence of topics and chapters in what we think is the most natural order in which to cover the material. But we recognize that there are alternative views on the best order. We have kept this fact and the need for flexibil- ity firmly in mind throughout the text. Many alternative sequences work, and the Flexibility Chart on p. xxxi explain the alternative pathways through the chapters. In using the flexibility information, keep in mind that the best sequence is the one in which we present the topics. And even chapters that the flexibility charts iden- tify as strictly optional are better covered than omitted.

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ACKNOWLEDGMENTS

Working on a project such as this one generates many debts that can never be repaid. But they can be acknowledged, and it is a special pleasure to be able to do so here and to express our heartfelt thanks to each and every one on the following long list, without whose contributions we could not have produced Foundations. Mark Rush again coordinated, managed, and contributed to our Solutions Manual, Instructor’s Manual, and Test Item Files. He assembled, polished, wrote, and rewrote these materials to ensure their close consistency with the text. He and we were in constant contact as all the elements of our text and package came together. Mark also made many valuable suggestions for improving the text and the Checkpoint Problems. His contribution went well beyond that of a reviewer, and his effervescent sense of humor kept us all in good spirits along the way. The ideas from which Foundations grew began to form over dinner at the Andover Inn in Andover, Massachusetts, with Denise Clinton and Sylvia Mallory.­ We gratefully acknowledge Sylvia‘s role not only at the birth of this project but also in managing its initial development team. Denise was an ongoing inspira- tion for 15 years, and we are privileged to have had the benefit of her enormous experience. The success of Foundations owes much to its outstanding editors: Director of Product Management, Adrienne D’Ambrosio. Adrienne’s acute intelligence and sensitive understanding of the market have helped sharpen our vision of this text and package over earlier editions. The value-added of Adrienne has been huge and we hope it will, for many future editions, remain a joy to work with her. As the revision progressed, Christopher DeJohn, Samantha Lewis, and Thomas Hayward brought fresh new ideas to our ninth edition. Sugandh Juneja, our Content Producer, worked with a talented team at Integra, Project Editor, Heather Johnson, and the designer, art coordinator, and typesetter. Our copy editor, Catherine Baum, gave our work a thorough review and helpful polish, and our proofreader ensured the most error-free text we have yet produced. Our marketing team, comprised of Nayke Heine and Ashley DePace, has been an integral part of this revision process. They have provided great ­knowledge and strategies to help continuously improve our suite of materials and keep them relevant and valuable in these ever-changing times. Richard Parkin, our technical illustrator, created the figures in the text and the PowerPoint presentations. Jeannie Shearer, our long-standing personal ­assistant, worked closely with us to create assignment problems. Finally, our reviewers, whose names appear on the following pages, have made an enormous contribution to this text. Once again we find ourselves using superlatives, but they are called for. In the many texts that we’ve written, we’ve not seen reviewing of the quality that we enjoyed on this revision. It has been a pleasure (if at times a challenge) to respond constructively to their many excel- lent suggestions.

Robin Bade Michael Parkin London, Ontario, Canada [email protected] [email protected]

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FOUNDATIONS OF ECONOMICS: FLEXIBILITY CHART

Micro Flexibility

Chapter 1 Chapter 5

Getting Started Elasticity Chapter 8 Chapter 15

Taxes Perfect Competition

Chapter 2 Chapter 9 Chapter 16 The U.S. and Global Economies Global Markets Monopoly in Action

Chapter 3 Chapter 6 Chapter 7 Chapter 17 The Economic Efficiency and Problem Equity Government Actions Monopolistic in Markets Competition

Chapter 4 Chapter 10 Chapter 18 Demand and Supply Externalities Oligopoly

Chapter 11 Chapter 19

Public Goods and Markets for Factors Chapter 13 Common Resources of Production

Consumer Choice and Demand Chapter 12 Chapter 20

Private Information and Economic Chapter 14 Healthcare Markets Inequality Production and Costs

Start here ... … then jump to … and jump to any of these after any of these … doing the prerequisites indicated

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Gautam Bhattacharya, University of Ninth edition Earlier editions Kansas Gerald W. Bialka, University of North Florida Farhad Ameen, Westchester Community Leon Hoke, University of Tampa David Bivin, Indiana University–Purdue College Christopher Jeffords, Indiana University University at Indianapolis Luke Armstrong, Austin Community of Pennsylvania; University of Geoffrey Black, Boise State University College Connecticut Carey Anne Borkoski, Arundel Matthew Baker, Hunter College and the Stephen Jerbic, San Jose State University Community College Graduate Center, CUNY Vicki King-Skinner, Coastal Carolina Jurgen Brauer, Augusta State University Andie Chiasson, Nicholls State University Greg Brock, Georgia Southern University David Manifold, Caldwell Community University Edward G. Creppy, Norther Virginia College & Technical Center Barbara Brogan, Northern Virginia Community College - Loudon Michael Nuwer, State University of New Community College Carolyn Dole, Jacksonville University York at Potsdam Bruce C. Brown, California State Randall Filer, Hunter College of CUNY Abdulhamid Sukar, Cameron University Polytechnic University, Pomona Reginald Gray, Mountain View College Lisa Takeyama, San Francisco State Christopher Brown, Arkansas State Carolyn Dole, Jacksonville University University University Chris Jeffords, Indiana University of Benjamin Zamzow, Campbell University James O. Brown, Delta State Pennsylvania Ting Zhang, University of Baltimore University Shakira Johnson, University of Texas at Alfredo A. Romero Aguirre, North Brian Buckley, Clemson University San Antonio Carolina A&T State University Donald Bumpass, Sam Houston State Natasha Jones-Ham, Orange County Seemi Ahmad, Dutchess Community University Public Schools College Seewoonundun Bunjun, East Meric Keskinel, Loyola Marymount William Aldridge, Shelton State Stroudsburg University University Community College Nancy Burnett, University of Wisconsin Santosh Kumar, Sam Houston State Rashid B. Al-Hmoud, Texas Tech at Oshkosh University University James L. Butkiewicz, University of Sunita Kumari, St. Petersburg College Neil Alper, Northeastern University Delaware Jason Lee, Lake Highland Preparatory Nejat Anbarci, Deakin University Barbara Caldwell, Saint Leo University School J.J. Arias, Georgia College & State Bruce Caldwell, University of North Meghan Mihal, St. Thomas Aquinas College University Carolina, Greensboro Nicholas Nervo, Tarrant County College Luke A. Armstrong, Lee College Joseph Calhoun, Florida State University Inge O'Connor, Syracuse University Leland Ash, Skagit Valley College Robert Carlsson, University of South Artatrana Ratha, Saint Cloud State Ali Ataiifar, Delaware County Carolina University Community College Shawn Carter, Jacksonville State Dennis Shannon, Southwestern Illinois John Baffoe-Bonnie, Pennsylvania University College State University, Delaware County Regina Cassady, Valencia Community Farley Staniec, University of the Pacific Campus College Eunice Akoto, Henderson State A. Paul Ballantyne, University of Jack Chambless, Valencia Community University Colorado College Mehdi Arman, Columbia State Tyra D. Barrett, Pellissippi State Joni Charles, Southwest Texas State Community College Community College University Luke Armstrong, Austin Community Sue Bartlett, University of South Anoshua Chaudhuri, San Francisco State College Florida University Michael Aubry, Cuyamaca College Gerald Baumgardner, Penn College Robert Cherry, Brooklyn College Bizuayehu Bedane, Southern Illinois Klaus Becker, Texas Tech University Chi-Young Choi, University of New University at Carbondale Clive Belfield, Queen’s College, City Hampshire Victor Claar, Henderson State University University of New York Paul Cichello, Xavier University Earl Davis, Nicholls State University William K. Bellinger, Dickinson College Quentin Ciolfi, Brevard Community Carol Dole, Jacksonville University John Bethune, Barton College College Byron Gangnes, University of Hawaii Prasun Bhattacharjee, East Tennessee Victor V. Claar, Henderson State at Manoa State University University xxxii

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Jane L. Cline, Forsyth Technical Elena Ermolenko Fein, Oakton Dennis Hammett, University of Texas at Community College Community College El Paso Jim Cobbe, Florida State University Gary Ferrier, University of Arkansas Leo Hardwick, Macomb Community John Cochran, University of Chicago Rudy Fichtenbaum, Wright State College Mike Cohick, Collin County Community University Mehdi Haririan, Bloomsburg University College Donna K. Fisher, Georgia Southern Paul Harris, Camden County Ludovic Comeau, De Paul University University Community College Carol Conrad, Cerro Coso Community Kaya Ford, Northern Virginia Mark Healy, William Rainey Harper College Community College College Christopher Cornell, Vassar College Robert Francis, Shoreline Community Rey Hernandez-Julian, Metropolitan Richard Cornwall, University of College State College of Denver California, Davis Roger Frantz, San Diego State University Gus Herring, Brookhaven College Kevin Cotter, Wayne State University Amanda S. Freeman, Kansas State Michael Heslop, Northern Virginia Erik Craft, University of Richmond University Community College Tom Creahan, Morehead State Marc Fusaro, East Carolina University Steven Hickerson, Mankato State University Arthur Friedberg, Mohawk Valley University Elizabeth Crowell, University of Community College Frederick Steb Hipple, East Tennessee Michigan at Dearborn Julie Gallaway, Southwest Missouri State State University Susan Dadres, Southern Methodist University Lee Hoke, University of Tampa University Byron Gangnes, University of Hawaii Andy Howard, Rio Hondo College David Davenport, McLennan Gay GareschÈ, Glendale Community Yu Hsing, Southeastern Louisiana Community College College University Troy Davig, College of William and Mary Neil Garston, California State University, Greg Hunter, California State Jeffrey Davis, ITT Technical Institute Los Angeles Polytechnic University, Pomona (Utah) Lisa Geib-Gunderson, University of Matthew Hyle, Winona State University Lewis Davis, Union College Maryland Todd Idson, Boston University Dennis Debrecht, Carroll College Lisa M. George, City University of Harvey James, University of Hartford Al DeCooke, Broward Community College New York Russell Janis, University of Jason J. Delaney, Georgia Gwinnett Linda Ghent, Eastern Illinois Massachusetts at Amherst College University Ricot Jean, Valencia College Vince DiMartino, University of Texas at Soma Ghosh, Bridgewater State College Jay A. Johnson, Southeastern Louisiana San Antonio Kirk Gifford, Ricks College University Vernon J. Dobis, Minnesota State Scott Gilbert, Southern Illinois Ted Joyce, City University of New York, University–Moorhead University Baruch College Carol Dole, Jacksonville University Maria Giuili, Diablo Valley Community Ahmad A. Kader, University of Nevada, Kathleen Dorsainvil, American College Las Vegas University Mark Gius, Quinnipiac College Jonathan D. Kaplan, California State John Dorsey, University of Maryland, Gregory E. Givens, University of University, Sacramento College Park Alabama Arthur Kartman, San Diego State Amrik Singh Dua, Mt. San Antonio Randall Glover, Brevard Community University College College Chris Kauffman, University of Tennessee Marie Duggan, Keene State College Stephan Gohmann, University of Diane Keenan, Cerritos College Allen Dupont, North Carolina State Louisville Brian Kench, University of Tampa University Richard Gosselin, Houston Community John Keith, Utah State University David Eaton, Murray State University College Kristen Keith, University of Toledo Kevin J. Egan, University of Toledo John Graham, Rutgers University Joe Kerkvliet, Oregon State University Harold W. Elder, University of Alabama Patricia E. Graham, University of Randall Kesselring, Arkansas State Harry Ellis, University of North Texas Northern Colorado University Stephen Ellis, North Central Texas Warren Graham, Tulsa Community Gary Kikuchi, University of Hawaii at College College Manoa Carl Enomoto, New Mexico State Homer Guevara, Jr., Northwest Vista Douglas Kinnear, Colorado State University College University Chuen-mei Fan, Colorado State Osman Gulseven, North Carolina State Morris Knapp, Miami Dade Community University University College Chris Fant, Spartanburg Community Jang-Ting Guo, University of California, Steven Koch, Georgia Southern College Riverside University

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Kate Krause, University of New Mexico David Mitchell, Valdosta State Mary Rigdon, University of Texas, Stephan Kroll, California State University Austin University, Sacramento Dr. Carl B. Montano, Lamar University Helen Roberts, University of Illinois at Joyce Lapping, University of Southern Christine Moser, Western Michigan Chicago Maine University Greg Rose, Sacramento City College Tom Larson, California State University, William Mosher, Clark University Barbara Ross, Kapi’olani Community Los Angeles Mike Munoz, Northwest Vista College College Robert Lemke, Florida International John R. Mundy, St. Johns River State Elham Rouhani, Gwinnett Technical University College College J. Mark Leonard, University of Nebraska Kevin Murphy, Oakland University Jeffrey Rous, University of North Texas at Omaha Ronald Nate, Brigham Young University, June Roux, Salem Community College Tony Lima, California State University, Idaho Udayan Roy, Long Island University Hayward Nasrin Nazemzadeh, Rowan Cabarrus Nancy C. Rumore, University of Joshua Long, Ivy Tech Community Community College Louisiana–Lafayette College Michael Nelson, Texas A&M University Mark Rush, University of Florida Kenneth Long, New River Community Rebecca Neumann, University of Rolando Sanchez, Northwest Vista College Wisconsin—Milwaukee College Noel Lotz, Middle Tennessee State Charles Newton, Houston Community Joseph Santos, South Dakota State University College Southwest University Marty Ludlum, Oklahoma City Melinda Nish, Salt Lake Community Roland Santos, Lakeland Community Community College College College Brian Lynch, Lake Land College Lee Nordgren, Indiana University at Mark Scanlan, Stephen F. Austin State Michael Machiorlatti, Oklahoma City Bloomington University Community College Norman P. Obst, Michigan State Ted Scheinman, Mount Hood Roger Mack, De Anza College University Community College Michael Magura, University of Toledo Inge O’Connor, Syracuse University Buffie Schmidt, Augusta State University Mark Maier, Glendale College William C. O’Connor, Western Montana Jerry Schwartz, Broward Community Svitlana Maksymenko, University of College–University of Montana College Pittsburgh Fola Odebunmi, Cypress College Gautam Sethi, Bard College Paula Manns, Atlantic Cape Community Victor I. Oguledo, Florida A&M Margaret Anne Shannon, Georgia College University Southern University Dan Marburger, Arkansas State Charles Okeke, College of Southern Mushtaq Sheikh, Union County College University Nevada Michelle Sheran-Andrews, University of Kathryn Marshall, Ohio State University Lydia M. Ortega, St. Philip’s College North Carolina at Greensboro John V. Martin, Boise State University P. Marcelo Oviedo, Iowa State University Virginia Shingleton, Valparaiso Drew E. Mattson, Anoka-Ramsey Jennifer Pate, Ph.D., Loyola Marymount University Community College University Steven S. Shwiff, Texas A & M Stephen McCafferty, Ohio State Sanjay Paul, Elizabethtown College University—Commerce University Ken Peterson, Furman University Charles Sicotte, Rock Valley College Thomas S. McCaleb, Florida State Tim Petry, North Dakota State Issoufou Soumaila, Texas Tech University University University Katherine S. McCann, University of Charles Pflanz, Scottsdale Community Martin Spechler, Indiana University Delaware College Leticia Starkov, Elgin Community William McLean, Oklahoma State Jonathon Phillips, North Carolina State College University University Stela Stefanova, University of Delaware Diego Mendez-Carbajo, Illinois Basharat Pitafi, Southern Illinois John Stiver, University of Connecticut Wesleyan University University Richard W. Stratton, The University of Evelina Mengova, California State Anthony Plunkett, Harrison College Akron University, Fullerton Paul Poast, Ohio State University Abdulhamid Sukar, Cameron University Thomas Meyer, Patrick Henry Greg Pratt, Mesa Community College Terry Sutton, Southeast Missouri State Community College Fernando Quijano, Dickinson State University Meghan Millea, Mississippi State University Janet M. Thomas, Bentley College University Andy Radler, Butte Community College Donna Thompson, Brookdale Michael Milligan, Front Range Ratha Ramoo, Diablo Valley College Community College Community College Karen Reid, University of Wisconsin, Deborah Thorsen, Palm Beach State Jenny Minier, University of Miami Parkside College

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James Thorson, Southern Connecticut Va Nee L. Van Vleck, California State Benjamin Widner, Colorado State State University University, Fresno University Marc Tomljanovich, Colgate University Victoria Vernon, Empire State College / Barbara Wiens-Tuers, Pennsylvania State Cynthia Royal Tori, Valdosta State SUNY University, Altoona University Christian Weber, Seattle University Katherine Wolfe, University of Ngoc-Bich Tran, San Jacinto College South Ethel Weeks, Nassau Community Pittsburgh Nora Underwood, University of College Kristen Wolfe, St. Johns River State California, Davis Jack Wegman, Santa Rosa Junior College College Jogindar S. Uppal, State University of Jason White, Northwest Missouri State New York University

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