Class Notes (939,536)
CA (549,738)
UTSG (46,496)
ECO (1,660)
ECO206Y1 (45)
Lecture

ECO206 - assignment 1 notes

6 Pages
103 Views

Department
Economics
Course Code
ECO206Y1
Professor
Gordon Cleveland

This preview shows pages 1-2. Sign up to view the full 6 pages of the document.
TUTORIALS
Your tutorials are scheduled on the same day each week (different days for different
students). Tutorial questions are printed below.
****************************************************************
ECM A04H
TUTORIAL #1 (WEEK 2)
1. What is the opportunity cost to you of going to Economics class?
The implicit costs are my time, loss of wages from job that I could have been
doing instead. Instead of going to class I could be going out with friends or
playing. The explicit(direct) cost would be money because I paid to go to this
class.
2. What is the opportunity cost to you of getting a university education?
The implicit costs are my time and what I could have been doing instead of going
to university. I could be getting a paying job instead and earn income for the
time. The explicit costs are tuition. Must measure opportunity cost in terms of
money for both implicit and explicit costs. Measure time in dollars.
3. What is the opportunity cost to you of taking a part-time job during the school
year?
The implicit cost would be my time and the fact that I could be studying to
increased my grades for university. The explicit costs would be the money that I
make during my part time job. Value of grades dropping in dollars to compare to
the wages I make from my job.
4. Assume that Jane lives in a single-person economy and is only able to produce
juice (Y) and nuts (X). Her Production Possibilities Frontier for one month's
production can be described by the function:
Y = 400 - 30X - X20 X10
(a) What is the maximum amount of juice (in litres) that she could
produce? What is the maximum amount of nuts (in kilos) that she
could produce? The maximum number of the produce X is 10 and the
max number of produce Y is 400 (y- intercept).
(b) Why do we restrict X to lie in the interval (0,10) when we write the
PPF as a function? We restrict X to lie in the interval (0, 10) because all
other values less than 0 are in the negative region and 10 is the
maximum number of the nut produce that are available.
(c) Is the point (5, 100) [i.e., X=5, Y=100] an efficient amount of production
for Jane? Why or why not? This is not an efficient amount of production
because when X is 5, there can be 225 units of Y. So, she is not using her
resources well.
(d) Sketch the PPF. Divide the diagram into three sets, as follows: points that
are attainable but inefficient; points that are attainable and efficient; points
that are unattainable.
(e) What is the opportunity cost of nuts at (4, 264)? What is the opportunity
cost of juice at the same point? Repeat both questions at (8,96). How are
these costs related to calculus concepts that you have learned? How are they
related to geometric properties of the graph that you have sketched?
(queston will be on exam)***
The opportunity cost of nuts = -dY/dX = - (-30 – 2x) = 30 + 2X
Opportunity cost of juice = -dX/dY = 1/(30 + 2X) (inverse)
For point (4, 264)
-dY/dX = 30 + 24 = 38L of juice
-dXdY = 1/ (30 + 2X) = 1/38 Kilos of nuts
Therefore the opportunity 38L of juice is 1/38Kilos of nuts.
For point (8, 96)
-dY/dX = 30 + 2X = 30 + 16 = 46L of juice
-dX/dY = 1/(30 + 2X) = 1/46 Kilos of nuts
The opportunity cost of 46L of juice is 1/46 kilos of nuts.
Theses costs are related to calculus concepts that I have learned because it
involves maximizing profit. They also relate to the properties of graphs because I
need to know things such as the zeros, intercepts, shapes of graphs and max/min
point. The slope of the tangent is the opportunity cost.

Loved by over 2.2 million students

Over 90% improved by at least one letter grade.

Leah — University of Toronto

OneClass has been such a huge help in my studies at UofT especially since I am a transfer student. OneClass is the study buddy I never had before and definitely gives me the extra push to get from a B to an A!

Leah — University of Toronto
Saarim — University of Michigan

Balancing social life With academics can be difficult, that is why I'm so glad that OneClass is out there where I can find the top notes for all of my classes. Now I can be the all-star student I want to be.

Saarim — University of Michigan
Jenna — University of Wisconsin

As a college student living on a college budget, I love how easy it is to earn gift cards just by submitting my notes.

Jenna — University of Wisconsin
Anne — University of California

OneClass has allowed me to catch up with my most difficult course! #lifesaver

Anne — University of California
Description
TUTORIALS Your tutorials are scheduled on the same day each week (different days for different  students).  Tutorial questions are printed below. **************************************************************** ECM A04H TUTORIAL #1 (WEEK 2) 1. What is the opportunity cost to you of going to Economics class? The implicit costs are my time, loss of wages from job that I could have been  doing instead.  Instead of going to class I could be going out with friends or  playing.  The explicit(direct) cost would be money because I paid to go to this  class.   2. What is the opportunity cost to you of getting a university education? The implicit costs are my time and what I could have been doing instead of going  to university.  I could be getting a paying job instead and earn income for the  time.  The explicit costs are tuition.  Must measure opportunity cost in terms of  money for both implicit and explicit costs.  Measure time in dollars.   3. What is the opportunity cost to you of taking a part­time job during the school  year?   The implicit cost would be my time and the fact that I could be studying to  increased my grades for university.  The explicit costs would be the money that I  make during my part time job.  Value of grades dropping in dollars to compare to  the wages I make from my job.   4. Assume that Jane lives in a single­person economy and is only able to produce  juice (Y) and nuts (X).  Her Production Possibilities Frontier for one month's  production can be described by the function: Y = 400 ­ 30X ­ X 0 ≤X≤10 (a) What is the maximum amount of juice (in litres) that she could  produce?  What is the maximum amount of nuts (in kilos) that she  could produce?  The maximum number of the produce X is 10 and the  max number of produce Y is 400 (y­ intercept). (b) Why do we restrict X to lie in the interval (0,10) when we write the  PPF as a function?  We restrict X to lie in the interval (0, 10) because all  other values less than 0 are in the negative region and 10 is the  maximum number of the nut produce that are available.   (c) Is the point (5, 100) [i.e., X=5, Y=100] an efficient amount of production  for Jane?  Why or why not?  This is not an efficient amount of production  because when X is 5, there can be 225 units of Y.  So, she is not using her  resources well.  (d) Sketch the PPF.  Divide the diagram into three sets, as follows: points that  are attainable but inefficient; points that are attainable and efficient; points  that are unattainable. (e)  What is the opportunity cost of nuts at (4, 264)?  What is the opportunity  cost of juice at the same point?  Repeat both questions at  (8,96).  How are  these costs related to calculus concepts that you have learned?  How are they  related to geometric properties of the graph that you have sketched?  (queston will be on exam)*** The opportunity cost of nuts = ­dY/dX = ­ (­30 – 2x) = 30 + 2X Opportunity cost of juice = ­dX/dY = 1/(30 + 2X) (inverse) For point (4
More Less
Unlock Document


Only pages 1-2 are available for preview. Some parts have been intentionally blurred.

Unlock Document
You're Reading a Preview

Unlock to view full version

Unlock Document

Log In


OR

Don't have an account?

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit