Explain opportunity cost
[PDF File]Microeconomics: Scarcity, Opportunity Cost & PPF
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opportunity cost (i.e. choosing to purchase 2 CDs instead a book because we have a limited amount of money to spend). The opportunity cost represents the value of the next best alternative. It applies to both the supply side of the market (production) and the demand side of the market (consumption).
[PDF File]THE CONCEPT OF OPPORTUNITY COST: IS IT SIMPLE, …
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contrived, opportunity cost questions’. The authors’ discussion may be summed up as follows. First, undergraduate teaching is failing to deliver good understandings of opportunity cost. Second, graduate education is likewise deficient because it does not revisit the concept and reinforce its relevance to real world decisionmaking.
[PDF File]The Cyclicality of the Opportunity Cost of Employment
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ow value of the opportunity cost of employment, which we denote by z, plays a crucial role in many such models. The importance of this variable has generated debate about its level, but the literature has almost uniformly adopted the assumption that the opportunity cost is constant over the business cycle.
[PDF File]A Critical Review of the Opportunity Cost Concept
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Discussion of the Opportunity Cost Concept 74 The Opportunity Cost Concept from an Accounting Perspective 78 Functions of the Accounting Craft 79 The Relevant Cost Concept and the Opportunity Cost Concept 83 The Classification of Costs 89 Irrelevance of the Accountants’ Approach 93 The Economists’ View - Where the Differences Are 99
Production Possibilities Curve tradeoffs
Production Possibilities Curve The concept of opportunity cost and associated tradeoffs may be illustrated with a picture. Production Possibilities Curve – a graph that shows alternative ways to use an economy’s resources – does not show consumer satisfaction. It is a model of a macro
[PDF File]Scarcity, Opportunity Cost, and Trade - Pearson
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1.2 Define and describe opportunity cost. 1.3 Describe how comparative advantage, specialization, and trade make us all better off. 1.4 Explain how markets connect us all using the circular flow of economic life. 1.5 Illustrate and explain the Three Keys to Smart Choices. Scarcity, Opportunity Cost, and Trade 01_cohen_ch01.qxp 4/17/09 9:48 AM ...
[PDF File]Scarcity and Opportunity Cost Station - Weebly
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opportunity cost. • A city government has $20,000 to spend. They decide to spend it on new job programs instead of on trash collection days. A clean environment is the opportunity cost. Socioeconomic Goals: There are things that the government tries to achieve
[PDF File]Factors of Production, Scarcity, Choice and Opportunity Cost
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•Opportunity cost is very important to the government. Use examples to explain what is meant by opportunity cost. (5 marks) •Explain two ways by which resources are …
[PDF File]Microeconomics Topic 1: “Explain the concept of ...
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Opportunity cost includes both explicit and implicit costs. The notion of opportunity cost helps explain why star athletes often do not graduate from college. The cost of going to school includes the millions of dollars they could earn as a professional athletes. If Kobe Bryant had …
[PDF File]SCARCITY, CHOICE AND THE PRODUCTION POSSIBILITIES …
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Opportunity Cost . The relevant cost of any decision is its opportunity cost - the value of the next-best alternative that is given up. This will mean that if we choose more of one thing, we will have to have less of something else. Economists use the term . opportunity cost. to explain this behaviour. The opportunity cost of any action is the ...
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