Economic Concepts Worksheet

Topics: Economics, Opportunity cost, Marginalism Pages: 4 (1021 words) Published: January 20, 2008

Economic Concepts Worksheet

University of Phoenix
MBA501 Forces Influencing Business in the 21st Century

Economic Concepts Worksheet
ConceptApplication of Concept from Personal ExperienceReference to Concept in Reading Law of Increasing Opportunity Cost

As more resources are moved from the allocation towards the production of one good to the production of another good, the opportunity costs increase because the resources are not as efficient in the making of the chosen product.

This is an important concept to me because the changes in my company's industry are happening faster than the workforce can be trained and technological equipment purchased.
Our company has been experiencing greater competition in the marketplace and has lost business to other companies, making sales revenue fall. In order to make up for this loss of revenue, the company has laid off a large number of employees. At the same time the company is moving from traditional products and services to new products and services. The employees remaining with the company are being required to take on more projects and new tasks that they are not necessarily trained or skilled at completing. Because of this skill set mismatch within the workforce the company pays more for the new products as services as it increases production.

"The law of increasing opportunity costs: The more of a product that is produced, the greater is its opportunity cost" (McConnell & Brue, 2004, Chap. 2, p. 27). Opportunity Cost

Opportunity cost measures what must be given up to have another unit or service.

I have included this concept because opportunity costs are reflected daily in the market and personal choices made.
My husband and I have been considering trading in his old vehicle for a new car. His car has been paid off for several years. We have been considering the trade-offs that will have to be made in order to finance a monthly car payment....
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