ECN 304 Week 3
Anything Worth Doing
• People do things less well because of the added (marginal) cost.
• Writing a “C” paper is less costly than writing an “A” paper (Opportunity)
• Values of a professor and a student are different
• The question is…What quality level should you strive for?
Why the Young go to University
• Young are more accustomed to the routine of school?
• Young do not have family responsibility?
• Young realize the value of education?
• Young intellectually more alive?
• The answer? MC=MB
• Young’s costs lower
• Young’s benefits are larger gains for a longer period of time
Students Walking on the Grass
• Most people enjoy a beautiful lawn, So what do people walk on it?
• Nobody wants to be the first to do it but when it’s already walked on, it seems like
the cost is really low
• Grass may be a short cut, thus can bring benefits to the INDIVIDUAL
• MC is close to zero if the path is already there
• Most people think that if they ALONE walk on the grass, the MC will be close to
• In the end, the path is created in the beautiful path that no one wanted because
individuals think they are the only ones who are going to walk on the grass
• Polluting may be rational if the others behavior cannot be controlled escalation
• The opportunity cost may be less for you if you pollute because it may be faster
• Noise in a restaurant