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4 Cards in this Set
- Front
- Back
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Define opportunity cost
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the loss of other alternatives when one alternative is chosen
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how can opportunity costs be illustrated
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using a production possibility frontier
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What does a production possibility frontier show
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shows the maximum combinations of goods and services that can be produced by an economy in a given time period
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What do we assume with the PPF
(2) |
• All resources in the economy are being used fully and efficiently
• The state of technology is fixed |
