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How are individual makes choices?
Fundamental principles behind the individual choices are as follows:
1. Resources are scarce.
2. The real cost of anything is what you should give up to get this
Opportunity cost
This is all about what you have to forgo to acquire your choice.
3. "How much", this is a decision at the margin.
Trade-offs
Marginal decisions and marginal analysis
4. People generally take advantage of opportunities to make them better off.
Incentives
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What is exchange.rate?
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Figure below demonstrates a more developed version of the circular flow. In this figure we see how goods flow through various sectors of the economy. Figure Money in the c
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asiignment on ppc
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