ECN 340 Lecture Notes - Lecture 2: Peanut Butter, Mira-Bhayandar Municipal Corporation, Sexually Transmitted Infection

• School: Ryerson University
• Department: Economics
• Course: ECN 340
• Professor: Thomas Barbeiro

Document Summary

Young"s opportunity costs lower: you(cid:374)g"s (cid:271)e(cid:374)efits la(cid:396)ge(cid:396) gains for longer period of time. Students walking on the grass: most people enjoy a beautiful lawn. It occurs because each person believes the mc they contribute is low. Pollution: polluti(cid:374)g (cid:373)a(cid:455) (cid:271)e (cid:396)atio(cid:374)al if othe(cid:396)"s (cid:271)eha(cid:448)iou(cid:396) (cid:272)a(cid:374)(cid:374)ot (cid:271)e (cid:272)o(cid:374)t(cid:396)olled escalation can occur. In all these cases the individual thinks about the potential costs and benefits to himself/herself and acts accordingly. E. g. fire: no one in a position to take charge and co-ordinate. Its rational to panic in certain circumstances: if no one is in charge for example. Reckless driving: cost and benefits of driving includes probability of getting into an accident, airbags reduce probability of death reduce cost of careless driving, thus airbags and seatbelt will decrease private costs but increase social costs (social. (cid:455)ou"d d(cid:396)i(cid:448)e so (cid:373)u(cid:272)h more carefully; the individual should bear the costs of reckless driving.