My econ 101 students have to write a review of Russ Roberts's The Price of Everything this semester. Some questions corresponding to each chapter are below the fold. Comments are open for a few days if you have any suggestions; if you like any of these questions, please feel free to use them.

Chapter 1
1. Home Depot promises not to raise prices after natural disasters. Why might this be a wise business decision?

2. After the earthquake, Big Box doubled its prices. Use a supply and demand diagram to explain why the prices of diapers, flashlights, plywood, and other goods would increase after a disaster.

Chapter 2
1. Ruth Lieber claims that “no one can make a pencil.” Is this true or false? Explain your answer using some of the Key Elements of Economics.

2. At the end of the chapter, Ruth Lieber asks her students to find something that exhibits order without design. Provide and explain an example of your own.

Chapters 3 and 4
1. What happened to Celia Fernandez after Jose died? Why? How did Castro respond when she left Cuba?

2. Ruth Lieber argues that “prices are key” to coherent changes in the graphite industry. How are prices “key?”

3. On an average day, most people who go to the grocery store do not worry about whether the store will be out of milk, bread, or coffee. Why not?

Chapters 5 and 6
1. Suppose you have three children and two cookies. How do you divide them? What information do you need in order to make a decision?

2. Suppose you own a store and there are a hundred people lined up to buy fifty flashlights. Who should get them, and why?

3. Suppose you live in an earthquake-prone region like the San Francisco Bay area. Would you be more or less willing to hold a large inventory of flashlights if you knew that you could charge high prices for them in the event of a disaster?

4. What are the key differences between the scenarios in 1 and 2? How do these differences change your answer?

5. Ramon Fernandez wants “a world where flashlights are both cheap and available! Why can’t we have both?” How would you answer him?

Chapter 7
1. What wasn’t Cuba able to develop a massive and successful coffee industry? What problems did they confront in trying to centrally plan their productive activities?

2. How much wealthier are we today than in 1900? Why?

Chapters 8 and 9
1. What did Ruth’s husband do for a living? What motivated his clients?

2. Ruth Lieber tells Ramon Fernandez never to “confuse a person’s identity or value with her job title. They have nothing to do with each other.” Does this contradict what we have learned this semester? Explain.

3. This is a quote from Ruth Lieber on page 123: “I’m not pro-business. I’m not even pro-profits. There is nothing inherently good about high profits.” Explain.

Chapters 10 through 13
1. Which is a wiser use of resources: saving a million barrels of oil, or saving a single pound of aluminum? How do you know?

2. Ruth Lieber claims that the market “deserves some romance.” Do you agree or disagree? Why or why not?

3. Ruth Lieber and Ramon Fernandez discuss the ways in which the labor market is and is not like a game of musical chairs. How is musical chairs an inappropriate description of the labor market?

4. According to Ruth Lieber, why can’t companies like Walmart choose to pay their employees more or less? Explain your answer using the tools we have developed in class.

5. How wouldn’t Ruth help the poor? Explain how some of the “solutions” she discusses might actually make them worse off.

6. Who is “the weaver of dreams?”

7. Consider the expression “people before profit.” Evaluate it in light of the lessons of The Price of Everything and the Key Elements of Economics.