Purposeful behavior and marginal analysis a

Economics Dec 15, 2020

Purposeful behavior and marginal analysis

a. explain why there is "no free lunch".

b. are part of the economic perspective.

c. are relevant in short-term but not long-term analysis.

d. explain the "fallacy of composition".

Expert Solution

The correct option is (b). are part of the economic perspective.

The economic perspective relies on the basic assumption that the environment is one of the types of economic goods whose availability is scarce though it has multiple uses. Furthermore, it can be categorized as:

Scarcity and Choices
Purposeful behavior
Marginal analysis (Marginal benefit = Marginal cost)

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