Budget Constraint

Opportunity Set

Opportunity cost

Opportunity Cost of a $2 burger is ____.

Marginal Analysis

Law of Diminishing Marginal Utility
(happiness and satisfaction of banana)

Production Possibility Frontier (PPF)

Law of Diminishing (Marginal) Returns
(Education and Healthcare)

Q: PPF curved because of the ______.

Productive Efficiency

Allocative Efficiency

Absolute Advantage

Comparative Advantage
"Good at Everything Neighbor while you're Bad at Everything"

Is Trade an Absolute Advantage or Comparative Advantage?

Positive Statement

Normative Statement

What's the comparative advantage of Canada?
MS AB
Canada 2000 1000
USA 3000 6000