Economics Chapter 2 review

Economics Chapter 2 review - Economics Chapter 2 review 1....

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Economics Chapter 2 review 1. Absolute advantage is when someone has an absolute advantage over someone else because they can perform a task in fewer hours than another. Comparative advantage is when someone’s opportunity cost is lower for performing a task then another person. The principle of Comparative advantage says that everyone does best when one person concentrates on activities in which their opportunity cost is the lowest. A production possibilities curve is a graphical description of the maximum amount of goods on every level compared with another good. Attainable points on the graph either are a point of the curve or are on the left side of the curve. Unattainable points lie outside of the curve to the right and cannot be reached. Efficient points are on the curve and are efficient because they are the most of a good that can be produced at that point. Inefficient points are any point that lies within the PPC. 2.
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This note was uploaded on 09/20/2011 for the course ECON 201 taught by Professor Shoonlai during the Spring '09 term at Miami University.

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Economics Chapter 2 review - Economics Chapter 2 review 1....

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