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Flashcards in CH 1 VIDEOS Deck (6)
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1
Q

OPPORTUNITY COST FORMULA STATES?

A
EXPLICIT COST 
\+ 
IMPLICIT COST OF ALTERNATIVE 
= 
OPPORTUNITY COST
2
Q

ECONOMIC SURPLUS FORMULA STATES?

A
BENEFIT
\+
OPPORTUNITY COST
=
ECONOMIC SURPLUS
3
Q

OPPORTUNITY COST DEFINITION

A

EXPLICIT & IMPLICIT VALUE OF FOREGONE

4
Q

ECONOMIC SURPLUS DEFINITION

A

BENEFIT OF ACTION MINUS COST

5
Q

ECONOMIC SURPLUS METHOD 1 STATES

A
NET BENEFIT
-
OPPORTUNITY COST
=
ECONOMIC SURPLUS
6
Q

ECONOMIC SURPLUS METHOD 2 STATES

A
VALUE
-
EXPLICIT COST
-
OPPORTUNITY COST
=
ECONOMIC SURPLUS