Exam 1 Study Tips • Make sure you have read the chapters (1, 2, 3). • Work the check your understanding problems in each chapter. The answers are in the book. • Review the Aplia assignments, especially the questions you got wrong. • There is a study guide that goes with the book. It has many practice questions with answers. • There are practice quizzes available for free on the text website: www.worthpublishers.com/krugmanwells • Make flashcards so you can master the vocabulary. Topics to focus on: • Resources are scarce, so choices must be made. All choices involve opportunity cost. • What is opportunity cost? • What are explicit and implicit costs? • What does it mean to “think at the margin”? • What is the cost benefit principle? • The economy is based on specialization and exchange. • Economic units specialize based on comparative advantage. • How do we determine comparative advantage? • How does this differ from absolute advantage?
This is the end of the preview. Sign up
access the rest of the document.