EC 201 Lecture Notes - Lecture 2: Opportunity Cost, Marginal Cost, Marginal Utility
Document Summary
Econ 201 lecture 2 notes- chapter 2: key principles of economics. Opportunity cost- what you sacrifice to get something. There is a tradeoff in everything we do. The opportunity cost of going to college is the k you spend on tuition and fees and the k you would have made while working. The opportunity cost of skipping college is the extra k you would make every year after graduation. Rent and food is not included in this opportunity cost because those expenses would be paid either way. The opportunity cost of an extra tank overseas could be 100,000 more kids enrolled in head start or having million more to spend on improving highways. Production possibilities curve- a curve that shows possible combinations of products that an economy can produce, given that the resources are efficiently used and also fully employed. Points a-e are attainable, point f is not.
