ECON 110 Chapter Notes - Chapter 1: Opportunity Cost

• School: Queen's University
• Department: Economics
• Course: ECON 110
• Professor: Michael Frederick Barber

Document Summary

Five economic principles: people face trade-offs, limited resources (land, labour, capital, unlimited wants (wants outweigh ability to produce, you can"t get everything you want. Opportunity costs: limited resources and unlimited wants lead to choice, losing the benefits of the next best alternative. Trade creates value: trade (voluntary exchange if trade makes you better off, markets (brings together buyers/sellers of goods/services) Bow-shaped (opportunity cost rises as more of a good is produced: straight-line (opportunity cost remains constant, steeper the slope, the higher the opportunity cost.