1. Opportunity cost is the cost of forgone opportunity, for example if you sit on the couch for two hours. The idea relates to the definition of economics because people decide that they want the next best thing no matter what the product is and it will cause an opportunity cost if making that choice. Allocating a square block in the middle of New York City because it would take a lot more time and money to complete this project than if it were to be put in a typical suburb.
8. Economic resources are the human, natural and manufactured resources that are put into the production of services and goods. For economist to categorize the resources there are three different categories, Land, Capital and Labor. These resources are combined to produce goods and services so they also call it factors of production and inputs is another simple name for factors of production.
A. The simple fact that Automobiles start at zero and end at 8 and forklifts start at 30 and in at 0 gives the assumption that this is production possibilities curve based.
B. Producing an additional automobile will cost a certain number of forklifts. At point C, they are producing 4 automobiles and 21 forklifts. At point D, they are producing 6 automobiles and 12 forklifts. So adding about 2 automobiles will cost just about 9 forklifts. We can conclude that one additional automobile cost about 4 forklifts.The law of increasing opportunity costlaw of increasing opportunity costAs an economy moves along its production possibilities curve in the direction of producing more of a particular good, the opportunity cost of additional units of that good will increase. holds that as an economy moves along its production possibilities curve in the direction of producing more of... [continues]
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