Opportunity Costs
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7 Terms
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opportunity cost
the cost of the next best alternative use of money, time, or resources when one choice is made rather than another → @@__**WHAT YOU GIVE UP**__@@
* Example:
* $5,000 for: a cheap car OR a vacation including meals, hotels, and entertainment
* Example:
* $5,000 for: a cheap car OR a vacation including meals, hotels, and entertainment
2
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Absolute advantage
who is fastest (time) or has highest output (product)
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Comparative advantage
who gives up the least
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When constant is product
output
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When constant is time
input
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output equation
want / give up
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input equation
give up / want
Note 
Flashcards (65)