Marketing

The fact that people have unlimited wants means that, they always want more of at least one good. Because people’s wants are unlimited but resources are scarce, choices must be made. A resource is something that is used to produce goods and services. The expression there is no such thing as a free lunch means, that resources used up in producing the lunch are not available to satisfy other wants. Melissa is self-employed lawyer who choose a higher priced restaurant 2 miles from home, the higher monetary cost of the more expensive restaurant is offset by the higher opportunity cost of the lower priced restaurant. The Law of comparative advantage says that person should produce a good if she, has the lowest opportunity cost of producing that good. Barter is, the direct exchange of goods, without use of money. Because of specialization and comparative advantage most people, consume only what they produce themselves. Exhibit 2-3,if all the economy’s resource are used efficiently to produce good B, then the economy is at point G,. Points inside the production possibilities frontier represent, inefficiency or unemployment. Exhibit 2-8 represents robin’s hood production possibilities frontier what’s the opportunity cost of producing 2 more bowls, 2 arrows. Is an incorrect, household produce goods and services. The term utility means, satisfaction. Luigi owns operates a small restaurant the income he receives from the restaurant is classified as proprietor’s income. Major advantage of the sole proprietorship, ease of start-up. Firms are organized in one of three ways, as a sole proprietorship as a partnership as a corporation. Disadvantage of the corporation compared to the sole proprietorship, corporate income is taxed twice. The law of demand states that, price and quantity demanded are inversely related. A demand curve usually has a, negative slope because price and quantity demanded are inversely related. Exhibit4-12, a decrease in price from $21 to $15 leads to, a