Principles of Macroeconomics Prof. Jeffrey Nilsen. Fundamentals Chapters 1 - 3. Chapter 1 Thinking Like an Economist. Scarcity Principle Cost-Benefit Principle Incentive Principle Appendix: Graphing and Equations. Khan .
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Principles of MacroeconomicsProf. Jeffrey Nilsen
Fundamentals
Chapters 1 - 3
Taxi benefits (comfort & time) 30
Taxi extra cost (90 – 11) = 79
=> negative surplus, do not take taxi
If need transport late at night, time cost of bus may be infinite
(since they do not run at night)
Taxi benefits (comfort & time) 100
Taxi extra cost (90 – 11) = 79
=> positive surplus, take taxi
Counting insurance & registration you would take taxi,
but I & R must be paid if drive to Sofia or not,
they are sunk costs to be ignored
Marginal Costs are those incurred if choose to drive (35)
(marginal costs of taxi are 90)
Slope for plan ?
Slope for individual ?
Total output 12 + 4 bread and 12 + 8 beer
(Adelia has same O.C. in beer and could specialize in beer with another trader)
OC (wine) = slope
OC (bread) = inverse slope