terrichichester-BU204-homework-unit-1

terrichichester-BU204-homework-unit-1 - /100 Name: Terri...

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Name: Terri Chichester /100 BU204 HOMEWORK - UNIT 1 FIRST PRINCIPLES Chapter 1: Problems 2, 5, 9, and 12 on pages 18-19 Chapter 1 / FIRST PRINCIPLES /24 2. Describe some of the opportunity costs when you decide to do the following. a. Attend college instead of taking a job A major opportunity cost of attending college instead of taking a job is loss of income. Attending college is an expensive endeavor with the price of tuition and books, but by attending college and giving up a job opportunity there would also be the loss of the income that would be earned during this period. So all together the opportunity cost of attending college instead of taking a job is what would have been earned plus the loans taken for tuition and books, plus interest in the loans. b. Watch a movie instead of studying for an exam By watching a movie instead of studying for an exam you not only have to pay the cost of the movie, but you also have the loss of time spent studying. This could lead to a lower grade on the exam or even possibly failing the exam because of not being ready for it. c. Ride the bus instead of driving your car Riding the bus would probably be cheaper monetarily, but by choosing to ride the bus over taking your car you are giving up the convenience of stopping for things you would need, and this also makes you more dependent on a schedule not of your making.
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/36 5. In the following examples, state how you would use the principle of marginal analysis to make a decision. a. Deciding how many days to wait before doing your laundry In using marginal analysis to decide on how many days to wait before doing laundry, I would weigh the benefits of doing one or two loads a day and adjusting my daily activities to fit doing the laundry into my daily schedule against blocking out several hours on one day every week to get all the laundry done at one time. The first way I would not have as much laundry to do at one time and the laundry
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terrichichester-BU204-homework-unit-1 - /100 Name: Terri...

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