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Economics 20th Edition by Campbell McConnell ,Stanley Brue ,Sean Flynn
Edition 20ISBN: 978-0077660772Economics 20th Edition by Campbell McConnell ,Stanley Brue ,Sean Flynn
Edition 20ISBN: 978-0077660772 Exercise 1
What is an opportunity cost? How does the idea relate to the definition of economics? Which of the foldecisions would entail the greater opportunity cost: Ala square bin the heart of New York City for a surface parking or ala square bat the edge of a typical suburb for such a Explain.
Explanation
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The opportunity cost of a commodity is the amount of another commodity that has to be sacrificed to get an additional unit of the commodity. For example, if three Compact discs are to be sacrificed for producing an additional unit of a DVD, then the opportunity cost of a DVD is three compact discs. Its price in the current use should be at least equal to its opportunity cost, otherwise it would move to its next best use.
Economics is associated with the optimal choices in the conditions of scarcity. This is true when the resources are limited in comparison to their availability. While making choices the concept of opportunity cost is essential, since it helps in deciding the value of the good produced by using the given resources.
Ala square in the heart of New York City for a surface parking has a greater opportunity cost, as compared to the same for ala square of bat the edge of a typical suburb. It is due to the fact the former could be put in to more valuable use as compared to the latter.
Economics is associated with the optimal choices in the conditions of scarcity. This is true when the resources are limited in comparison to their availability. While making choices the concept of opportunity cost is essential, since it helps in deciding the value of the good produced by using the given resources.
Ala square in the heart of New York City for a surface parking has a greater opportunity cost, as compared to the same for ala square of bat the edge of a typical suburb. It is due to the fact the former could be put in to more valuable use as compared to the latter.
Economics 20th Edition by Campbell McConnell ,Stanley Brue ,Sean Flynn
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