chapter 4 micro
possible opportunity costs of a recent high school graduate starting college right away
-Spending a year backpacking across Europe -Getting a full time job. -Using your college fund to buy a new car.
Your budget constraint for entertainment illustrates the concept of _____, since as you increase your purchases of one item, you must _____ your purchases of the other item
trade offs, decrease
If you produce at a point on your PPC, then you are producing at a point that is ____________.
attainable and efficient
Suppose there are three activities in which you could participate: 1. The opportunity cost of the first activity is missing 3 hours of work. 2. The opportunity cost of the second activity is missing a concert that you have tickets to. 3. The opportunity cost of the third activity is missing the afternoon nap that you take every day. Given this information, for which of these activities would you be able to compare opportunity costs?
You can compare all the activities after you translate all the missed activities into dollar amounts.
A linear PPC would show ______ opportunity costs, and a PPC that is curved away from the origin would show ________ opportunity costs
constant, increasing
You would expect that the labor-force participation rate among highly educated women would be _____ than average, since the opportunity cost of not working for highly educated women is ______ than that of all women.
higher, higher
You would expect that the total fertility rate among highly educated women would be ______ than less educated women, since the opportunity cost of staying home to raise children is _______ for highly educated women.
lower, higher
On the Production Possibilities Curve, possible production levels are represented:
on any point on or below the curve
A production possibilities curve (PPC) ___________.
shows the relationship between the maximum production of one good for a given level of production of another good.
The concept of opportunity cost is a measure of ____
the value of the best alternative use of a resource
The opportunity cost of an activity is a measure of _______ when you do that activity.
what is given up
