Chapter 2 Inquiry

Chapter 2 Inquiry

by Samuel Paris -
Number of replies: 1

Concerning the chart with the food and clothes, is it possible that not reaching the arch is marginally beneficial? For example, is the opportunity cost of saved money ever going to be higher than the marginal benefit of reaching peak efficiency?

In reply to Samuel Paris

Re: Chapter 2 Inquiry

by Danny Weaver -
I like what you are getting at here. In this model, the only two things we could do with our resources that are of benefit are represented on the x and y axis. Therefore, any point under the curve represents resources sitting idly. Of course, you know that individuals, and even more so, economies, can produce way more than two goods. It is also worth mentioning that, as you alluded, not using resources can have benefits. I mean, look at us in America in 2025, many Americans choose to NOT work on weekends and only in 8 hour shifts during the week. This would be "under the curve" inefficient behavior, but those individuals wouldn't change their work schedules if you asked them. That said, the model is still a great model to demonstrate opportunity costs and marginal costs/benefits.