Opportunity Cost Flashcards
1
Q
Who makes trade-offs?
A
- People
- Business
- Society
2
Q
Opportunity Cost
A
Is the most desirable alternative you gave up in a trade-off
3
Q
What is the main idea of opportunity cost?
A
Because resources are scarce we must make choices or trade-offs. The 2nd most desirable thing lost by making this decision is the opportunity cost.
4
Q
Thinking at the Margin
A
When you are unsure of the opportunity cost and must decide how much more or less of a unit to use
5
Q
Trade-Off
A
All the alternatives that we give up whenever we make make a choice
