Economic way of thinking

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Intros
Lessons
  1. Economic Way of Thinking Overview:
  2. Rational Choices
    • Comparing Benefit and Cost
    • Net Benefit = Benefit - Cost
  3. Cost and Benefit
    • Cost: the opportunity cost of something
    • Benefit: the gain or pleasure that it brings
  4. Choices are Made at the Margin
    • An edge from which a choice is made
    • Marginal Benefit and Marginal Cost
    • MB = MC
  5. Respond to Incentives
    • Choices respond to incentives
    • Incentives is a reward or penalty
    • Encourages or Discourages action
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Examples
Lessons
  1. Understanding the 5 Key Ideas
    Net benefit can be calculated by using the formula:
    1. Benefit - Cost
    2. Benefit + Cost
    3. Cost - Benefit
    4. Benefit
  2. The maximum benefit can be found when
    1. MB > MC
    2. MB < MC
    3. MB ≠ MC
    4. MB = MC
  3. Making rational choices will lead us to respond to _________________.
    1. Costs
    2. Benefits
    3. Margins
    4. Incentives
  4. When the Marginal Benefit is great than the Marginal Cost, then we want to:
    1. Increase the unit
    2. Decrease the unit
    3. Let the unit stay the same
    4. Examine the Net Benefit