Eco 10-10-07 - Econ Notes 1 Ex why couples where both work...

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Econ Notes 10/10/07 1. Ex: why couples where both work have higher divorce rates a. Foregoing gains from specialization 2. Complete advantage and marginal Costs a. Suppose: Guns Spinach Sue 8 4 Charles 3 3 Daphne 1 2 i. Marginal cost of producing 1 unit of Spinach: 1. Daphne 1/2 unit of guns 2. Charles 1 unit of guns 3. Sue 2 units of guns 4. (See Guns and Spinach) a. Marginal cost curve 5. (Guns and Spinach2) a. Production possibility curve i. Maximum amount an economy can produce ii. Get rid of Daphne first, then Charles and finally Sue ii. Summary: 1. When producing according to comparative advantage, the marginal cost is increasing iii. Question: should the smartest people be brain surgeons? 1. Suppose there are only 2 jobs a. Brain surgeon b. Garbage Man 2. The smart person will probably have absolute advantage at both jobs a. For a person w/ low intelligence, achieving a career as a brain surgeon will be very costly iv. Ex: Gilligan’s Island 1. stupid people have the comparative advantage in doing menial tasks
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This note was uploaded on 04/07/2008 for the course ECO 2302 taught by Professor Smith during the Spring '08 term at University of Texas at Dallas, Richardson.

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Eco 10-10-07 - Econ Notes 1 Ex why couples where both work...

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