ECON 104 Lecture Notes - Lecture 3: Absolute Advantage, Trs-80 Color Computer, Opportunity Cost
17 Sep 2018
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Opportunity cost- when scarcity requires choices, opportunity cost is your next best option. Process of simplifying is a strength, not a weakness. George e. p. box- all models are wrong, but some are use useful . Constant return to scale- constant opportunity cost. Production possibilities graphs ( each producer gets a graph) Calculate opportunity costs ( there are several methods) -per unit opportunity cost. Gilligan has absolute advantage competition of coconuts and maryann has. Comparative advantage- who sacrifice the least in the competition- have to do absolute advantage in fish (absolute advantage is who make the most products) some calculation.
