This week’s reading assignment is Chapter 2: Principles of Economics with Applications in the Air Transport Industry.

This chapter introduces us to the economic way of thinking and fundamental concepts of economics including scarcity and opportunity cost. Pricing is used as an example of a microeconomic issue before moving on to macroeconomic issues including growth, inflation and unemployment.

The chapter continues with a discussion on the role of government in the economy and in aviation specifically, and ends with an explanation of two broad areas of economic failures.

This week’s written assignment will build upon your discussion post from Module 1. In that module, you made a thoughtful prediction regarding the health of the air transport industry over the next 36 months. In this week’s written assignment, using 300 – 500 words, you will further define your prediction using concepts covered in Chapter 2, answering the following question: Is your prediction based on microeconomic issues, on macroeconomic issues, or both? Fully explain your answer, demonstrating your understanding of the material presented in Chapter 2.