ECON 1B03 Study Guide - Fall 2018, Comprehensive Term Test Notes - Economic Equilibrium, Graph Of A Function, Ice Cream

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ECON 1B03 Full Course Notes
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ECON 1B03 Full Course Notes
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Econ1b03 lecture 2 - production possibilities and gains from trade. Microeconomic background information: positive statement- a claim that you can prove to be true or false. This usually involves a variable, and is not necessarily correct. Example: making a daily schedule can increase your productivity by 50%: normative statement- an opinion-based statement. These cannot be backed up by data or proven to be true or false, because others may think differently. Usually uses words like should or ought to . Canada should decrease federal taxes for canadian citizens. Opportunity cost: what you have to give up in order to get something, opportunity cost = explicit costs + implicit costs, explicit costs: what you actually spent to get something. Implicit costs: what you could have done instead. For opportunity cost, you use the best foregone alternative, which is the activity you could have done that would have yielded the most benefits.

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