Macro1 - Brineydi Peralta Week 1 Due: 10/3/10 Page19-20...

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Brineydi Peralta Week 1 Due: 10/3/10 Page19-20 Question 1.1. What is an opportunity cost? How does the idea relate to the definition of economics? Which of the following decisions would entail the greatest opportunity cost: Allocating a square block in the heart of New York City for a surface parking lot or allocating a square block at the edge of a typical suburb for such a lot? Explain. An opportunity cost is to give up something to obtain something else. The condition of scarcity creates opportunity cost. If there were no such thing as scarcity, there would be no need to give up on one thing to acquire another. 1-5. Indicate whether each of the following statements applies to microeconomics or macroeconomics: a. The unemployment rate in the United States was 5.2 percent in January 2005. b. A U.S. software firm discharged 15 workers last month and transferred the work to India. c. An unexpected freeze in central Florida reduced the citrus crop and caused the price of oranges to rise. d. U.S. output, adjusted for inflation, grew by 4.4 percent in 2004.
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This note was uploaded on 10/08/2010 for the course MAT 109 taught by Professor Michael during the Spring '10 term at Peirce.

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Macro1 - Brineydi Peralta Week 1 Due: 10/3/10 Page19-20...

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