MARITIME ECONS & TRANSPORTATION

MARITIME ECONOMICS &

TRANSPORTATION
ECON IS THE SOCIAL SCIENCE THAT
STUDIES THE PRODUCTION, DISTRIBUTION
& CONSUMPTION OF GOODS & SERVICES
COMES FROM GREEK OIKOS (HOUSE)
NOMOS (LAW)
ROBBINS DEFINES ECON AS THE SCIENCE
WHICH STUDIES HUMAN BEHAVIOUR AS A
RELATIONSHIP BETWEEN ENDS & SCARCE
MEANS WHICH HAVE ALTERNATIVE USES.
MICRO & MACRO ECON
MICRO ECON DEALS WITH THE OP OF
THE FIRM IN ITS IMMEDIATE MARKET,
EG. DETERMINATION OF PRICES,
REVENUES, COSTS, EMPLOYMENT
LEVELS.
MACRO ECON COMPRISES THE
GENERAL SOCIAL & ECON COND OF
LARGER SYSTEM OF WHICH EACH FIRM
FORMS A PART.
TERMINOLOGIES
RESOURCE ALLOCATION INVOLVING
PURCHASING RAW MATERIALS,
EMPLOYING LABOUR & UNDERTAKING
INVESTMENT
OPPORTUNITY COST THE LOST OF
THE OPPORTUNITY TO PURSUE THE
MOST ATTRACTIVE ALTERNATIVE
GIVEN THE SAME TIME & RESOURCES
DIMINISHING MARGINAL RETURN SITN
WHEREBY AS WE APPLY MORE OF ONE
INPUT TO ANOTHER INPUT, AFTER
SOMETIME THE RESULTING INCREASE IN
OUTPUT BECOMES SMALLER

MARGINAL ANALYSIS DETERMINES
WHETHER THE INCREASE IN OUTPUT WILL
PROVIDE ENOUGH EXTRA REVENUE TO
COMPENSATE FOR THE EXTRA COST OF
PRODUCTION WITH THE AIM OF FINDING
THE OPTIMAL LEVEL OF PRODUCTION
BUSINESS OBJECTIVE - TRADITIONAL OBJ
IS PROFIT MAXIMIZATION. OTHER OBJ
INCLUDE ACHIEVE PERSONAL GOAL,
GROWTH TARGETS FOR THE COY & MAX
SALES REVENUE/ VOLUME
TIME DIMENSION SHORT RUN MEANS
THE OP PERIOD OF BUSINESS WHERE AT
LEAST ONE FACTOR OF PRODUCTION IS
FIXED IN SUPPLY. LONG RUN IS THE
PLANNING HORIZON OF THE FIRM WHERE
ALL FACTORS OF PRODUCTION MAY BE
VARIED
ECON EFFICIENCY CONCERNED
WITH USING SCARCE RESOURCES TO
ACHIEVE STIPULATED ENDS.
PRODUCTIVITY IS THE EFFICIENCY IN
WHICH RESOURCES ARE USED TO
PRODUCE OUTPUT
RISK & UNCERTAINTY RISK OCCURS
WHERE THERE IS AN ELEMENT OF
INJURY OR LOSS. RISKS THAT ARE
DIFFICULLT TO ESTIMATE ARE
UNCERTAINTIES.
EXTERNALITIES SOCIAL COSTS AND
BENEFITS THAT ARE NOT REFLECTED
IN THE ANNUAL ACCOUNTS OF FIRMS.

DISCOUNTING CONCERNED WITH
THE FACT THAT COSTS & BENEFITS
ARISING IN FUTURE YRS ARE WORTH
LESS THAN COSTS & BENEFITS
ARISING TODAY.
DEMAND & SUPPLY
DEMAND & SUPPLY
REFERS TO PRICE & OUTPUT
DETERMINATION IN A PERFECTLY
COMPETITIVE MARKET
DEMAND SHOWS THE QNTY BUYERS WOULD
BE PREPARED TO PURCHASE AT EACH UNIT
PRICE OF THE GOOD
SUPPLY IS DIRECTLY PROPORTIONAL TO
PRICE & QNTY SUPPLIED. THE HIGHER THE
PRICE THE MORE PRODUCER WILL SUPPLY
D & S CURVE

COST & REVENUE
TOTAL COST OF PRODUCTION = FIXED
COST + VARIABLE COST

REVENUE IS THE MONETARY VALUE OF
PRODUCTS SOLD OR SERVICES
RENDERED TO CUSTOMERS &
RESULTS FM SALES, INTEREST,
DIVIDEND, COMMISSION ETC.
PROFIT & LOSS
A BUSINESS HAS TO BE PROFITABLE
TO SURVIVE
P & L ACCOUNT COMPRISES :
TRADING ACC DETAILING SALES REVENUE
LESS PRODUCTION EXPENSES
ACCOUNT FOR INCOME FM OTHER
SOURCES
ADMINISTRATIVE & OTHER
EXPENSES/COSTS
TYPES OF MARKET STRUCTURE
PERFECT COMPETITION
EG PASAR MALAM, TRAMP BUSINES
MONOPOLY
EG ELECTRICITY SUPPLY, LINER
CONFERENCE
OLIGOPOLY
EG WIRELESS COMMS, LINER SHIPPING
RECAP
WHAT IS ECONOMY?
EXPLAIN THE DIFFERENCES BETWEEN
MICRO & MACRO ECON?
WHAT ARE OPPORTUNITY COST,
MARGINAL ANALYSIS, EXTERNALITIES,
DISCOUNTING.
DESCRIBE THE D & S CURVE
DIFFERENTIATE THE 3 TYPES OF
MARKET STRUCTURE