Rec 1 - 1.) picnic @ the lake 2.) sleep 3.) read a book If...

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ECON Rec 715 Justin email: contat@email.unc.edu Office: Phillips Annex 202 Office Hours: W 2-3pm Review Quiz Review Graphing Opportunity Costs Scarcity – can’t always get what you want Incentive – reward that could change your choices Free lunch – don’t have to give up anything (like going from something attainable but not efficient to something attainable AND efficient) trade off – like going from one point on the PPF to another (both attainable and efficient) Demand = 13-2p Supply = 1 + 2p (solve both for p) p = (13-D)/2 p= (s-1)/2 Opportunity cost – best thing to give up to get something
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Unformatted text preview: 1.) picnic @ the lake 2.) sleep 3.) read a book If you are sleeping, the opportunity cost is the picnic @ the lake If you are picnicking at the lake, the op cost is sleeping and reading a book Opportunity cost is increasing when it has a bowed out line (the more you have to give up to get that extra apple) op cost of eating an apple is a banana & vis versa. It follows a curved line similar to the PPF line. PPF is linear Apples = -3*Bananas + 33 Op cost of a banana is 3 apples (whatever is right next to the slope is the op cost of that thing in terms of the Y) For a linear line, the opportunity cost is the slope ....
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This note was uploaded on 09/29/2009 for the course ECON 101 taught by Professor Balaban during the Spring '07 term at UNC.

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Rec 1 - 1.) picnic @ the lake 2.) sleep 3.) read a book If...

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