EBK PRINCIPLES OF MICROECONOMICS
12th Edition
ISBN: 9780134069180
Author: Oster
Publisher: YUZU
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Question
Chapter 2, Problem 1.5P
Subpart (a)
To determine
Trade-off situation and
Subpart (b)
To determine
Trade-off situation and opportunity cost involved in statement.
Subpart (c)
To determine
Trade-off situation and opportunity cost involved in statement.
Subpart (d)
To determine
Trade-off situation and opportunity cost involved in statement.
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Briefly describe the trade-offs involved in each of the following decisions. Specifically, list some of the opportunity costs associated with each decision, paying particular attention to the trade-offs between present and future consumption.
a. After a stressful senior year in high school, Sherice decides to take the summer off instead of working before going to college.
b. Frank is overweight and decides to work out every day and to go on a diet.
c. Mei is diligent about taking her car in for routine maintenance even though it takes 2 hours of her time and costs $100 four times each year.
d. Jim is in a hurry. He runs a red light on the way to work.
One of the lessons of economics is that āthere is no such thing as a free lunch.ā This means that businesses, consumers, and whole societies face trade-offs whenever they make a decision. Please draw on your own experiences to discuss the following three items. Make sure you use economic concepts in your main contribution.
Explain a decision that you have made at work, or one concerning your career, or any major life decision that you have made.
Identify and explain the trade-offs that you faced.
List the alternatives you had, identify the highest valued alternative, and explain your final decision to the class.
What is the name for something that changes the trade-offs that people facewhen making a decision?
Chapter 2 Solutions
EBK PRINCIPLES OF MICROECONOMICS
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- Please provide your answer, be sure to provide explanations and graphs This set of questions pertains to opportunity costs in different scenarios.a. On the night before the ECON2 exam, you are allocating your time between studying for the exam and reading comic books. Each hour of studying enhances your exam score by 2 points, and reading a comic book consumes 30 minutes. What is the opportunity cost of reading a comic book in terms of points on the exam? What is the opportunity cost of reading a comic book in terms of dollars for YOU? b. You are responsible for preparing dinner for yourself and your 2 roommates. You have two options: either purchase the ingredients and cook the meal from scratch, incurring a cost of $20 and spending 2 hours, or order the meal, which would cost $60 and take no time. Is the opportunity cost of the meal higher if you order it? Why or why not?arrow_forwardWhat does a production possibilities graph show in economics? Ā Ā Ā Ā how many items can be produced in a specific amount of time Ā Ā Ā Ā possible production costs Ā Ā Ā Ā one's final choice Ā Ā Ā Ā one's top two choices when making a decisionarrow_forwardIdentify the elements of scarcity, choice, and opportunity cost in each of the following: 1. The manager of an automobile assembly plant is considering whether to produce cars or sport utility vehicles (SUVs) next month. Assume that the quantities of labor and other materials required would be the same for either type of production. 2. A young man who went to work as a nursesā aide after graduating from high school leaves his job to go to college, where he will obtain training as a registered nurse.arrow_forward
- Which of the following best demonstrates the influence of economic factors on consumer decision-making? a. A consumer buys a Lexus after her neighbors and garden club pals each buy one. b. A married couple with three young children purchase a minivan. c. A blue collar worker holds off on buying a new truck, pending potential layoffs at work. d. A young professional buys a utility vehicle for off-road exploring.arrow_forwardWhich of the following statements about the production possibilities curve is the most accurate? OIt is a curve that shows the quantity of output that will be offered for sale at various prices. It is a graph that shows the various combinations of output it is possible for an economy to produce given its available resources and technology. It is a graph that shows the combinations of output that are most profitable to produce. It is a graph that shows the various combinations of resources that can be used to produce a given level of output.arrow_forwardHow does the slope of a budget line illustrate opportunity costs and trade-offs? How does a budget line illustrate scarcity and the effect of limited incomes?arrow_forward
- Marie has a weekly budget of $24, which she likes to spend on magazines and pies. If the price of a magazine is $4 each, what is the maximum number of magazines she could buy in a week? If the price of a pie is $12, what is the maximum number of pies she could buy in a week? What is Marieās opportunity cost of purchasing a pie? At the start of the week, Marie decides to buy a pie. Does this imply that the utility she receives from this pie is greater than or less than her opportunity cost of purchasing the pie? Marie is thinking about purchasing a second pie. Do we expect the marginal utility she receives from the second pie to be greater than, less than, or equal to the marginal utility she receives from the first pie? Explain your answer.arrow_forwardExplain how (if at all) each of the following events affects the location of a countryāsproduction possibilities curve.a.The quality of education increases.b.The number of unemployed workers increases.c.A new technique improves the efficiency of extracting copper from ore.d.A devastating earthquake destroys numerous production facilities.(a)The curve will shift out as the labor resource improves.(b)The curve will not shift, but the economy will produce further inside the curve.(c)The curve will shift out as a result of the technological improvement.(d)The curve will shift in as resources are destroyed.7arrow_forwardhe first principle of economics discussed in Chapter 1 is that people face trade-offs. Use a production possibilities frontier to illustrate societyās trade-off between two āgoodsāāa clean environment and the quantity of industrial output. What do you suppose determines the shape and position of the frontier? Show what happens to the frontier if engineers develop a new way of producing electricity that emits fewer pollutants.arrow_forward
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