1st Assignment
1- The purpose of economics is to provide a way to think. Economic thinking and decision-making
recognize that because of scarcity something cannot be obtained without giving up something
else. Consequently, we must make our decisions by comparing the costs and benefits and
evaluating the tradeoffs. In doing so, five principles of economic thought come into play:
tradeoffs, incentives, opportunity costs, marginal thinking, and voluntary exchange. Explain with
a specific example of each how you apply these five principles of economic thought in your
everyday life.
Table 1-1
Possible
Output
Combinations
Apples
(thousands of
kilos)
Pears
(thousands of
kilos)
A
70
0
B
60
20
C
50
36
D
40
48
E
30
56
F
20
60
G
10
63
H
0
65
