What is the opportunity cost

Assignment Help Macroeconomics

Reference no: EM13133696

Individuals, firms, governments, and countries are faced with choices because all resources are scarce. A production possibility curve (see below) measures the maximum combination of outputs that can be achieved from a given number of inputs. In practice economists use a production possibility curve with two goods to explain the concept of opportunity cost.

In the example below the two goods that a country can produce are health care and education.

Use the graph above to answer the following questions:

1409_opportunity cost.png

a. How many units can be produced if a country uses all of its resources on health care?
b. How many units can be produced if a country uses all of its resources on education?
c. If a country is currently producing 11 units of health care and 16 units of education, what is the opportunity cost of producing 5 more units of education?

While a production possibility curve describes the possible combinations of output that can be produced with a given set of inputs, it does not tell us who should receive, and in what amount, the health care and education that gets produced. Write an essay of at least 300 words but no more than 600 words in length which discusses the social justice implications of how to distribute the health care and education that gets produced.

Reference no: EM13133696

Questions Cloud

Uses of liberal education-audience and tone of the essay : Write an essay that analyzes the articles "On the Uses of a Liberal Education" By Earl Shorris providing an in-depth analysis of the intended audience and the effect on that audience.

What effect will the irs agent finding have : On audit, an IRS agent determines that $90,000 of the amount paid to each of the shareholders is unreasonable compensation. What effect will the IRS agent's finding have on the taxable income of the shareholders and the C corporation?

Find the dependent variable for achievement test : All the pupils took the same achievement test, and the means for groups receiving different methods were compared. What was the dependent variable?

Provide a differential anaylsis on the proposal to replace : The new machine would reduce annual maintenance costs by $23,000. Provide a differential anaylsis on the proposal to replace the machine.

What is the opportunity cost : How many units can be produced if a country uses all of its resources on health care and what is the opportunity cost of producing 5 more units of education?

What is the conversion cost per equivalent unit : Fifty-four thousand units were transferred out of the department and the ending inventory consisted of 2,500 units that are 20% complete with respect to conversion. What is the conversion cost per equivalent unit?

Corporate policy in mind : I have referred your letter that you wrote to us on June 20 to our staff attorney who reviewed the pertinent issue you raise with our corporate policy in mind.

How much property tax should be recognized for the year end : When preparing the government-wide financial statements, how much property tax should be recognized for the year ended June 30, 2007?

Find gain in the year the involuntary conversion occurred : on an involuntary conversion in which the taxpayer does not buy replacement property within the replacement period the gain on the involuntary conversion and any tax due must be reported.

User Account

All Pages