homework#1 - Principles of Microeconomics Problem Set #1 A....

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Principles of Microeconomics Problem Set #1 A. I liked the opening story “Common Ground” of chapter one on page five since it gave me a real life scenario of how economics can affect an individual’s life since many of the common principles of economics can apply to many different issues. For me, I have a difficult time learning things if I can’t find a way for me to apply it to my life or apply it to a friend so having an introduction where it describes concepts that we’re going to learn in economics was helpful. B. A penny was useful in the past because a penny used to have a high purchasing power. Back then; the minimum wage was around $2 an hour and was worth about 18 seconds of work. But due to inflation, a penny is now equivalent to around 2 seconds of work so it is not worth the opportunity cost (compared to the past) of the time it takes to worry about a penny. The economic principle behind this story is the 2 nd principle of microeconomics which is “the cost of something is what you gave up to
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This note was uploaded on 03/28/2011 for the course ECON 1101 taught by Professor Wang during the Spring '11 term at Northeastern.

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homework#1 - Principles of Microeconomics Problem Set #1 A....

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