ECON 1000- Final Exam Guide - Comprehensive Notes for the exam ( 26 pages long!)
29 Mar 2018
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Efficiency: society is getting the most from its scarce resources. Equity: the benefits of resources are distributed fairly among society"s members: efficiency refers to the size of the economic pie, equity refers to how the pie is divided into individual slices. Ppf: production possibility frontier: anything outside the frontier is not possible, output changes based on choosing between whether or not you want to produce more or less of one of your resources. To get one thing we like we must give up another thing we like. People are likely to make good decisions if they understand the options they have available. Opportunity cost: what must be given up in order to obtain some item. Principle number two: the cost of something is what you give up to get it. If the opportunity cost of one apple is two bananas, the opportunity cost of one banana is half an apple (ratio is just flipped)
