economia

Question 1

A) When supply and demand is not in balanced or do not match. The result of the disequilibrium of these forces causes a shortage or surplus, which alters the cost. This factor occurs causing shortage or surplus to augment due to the quantity supplied and quantity demanded. When it is equilibrium it means that it tends to keep it stable. When the market is in disequilibrium it means that the demand is bigger or smaller than the offer on the market. If there is more supply then demand it means that there is less people buying the product or services in relation to the supply or the production of the same products or services, now when there is more demand than supply it means that there is a high volume of purchases resulting on a demand for production. In result there is an augmentation of the economy that brings more jobs and at the same time causes prices to go high.

B) Opportunity cost is a term used in economy that means the alternative opportunity or the benefits that could have been taken by this alternative opportunity. It is defined by the expression from the scarcity and choice the implicit costs belong to the company, and don’t involve a higher money input. They estimated from what could have been gain with the best alternative product. Not just the explicit cost the opportunity cost happens for the fact that the resources can be used in alternative ways. In other words the opportunity cost represents the value associated with the best choice not chosen.

When a choice is made it is put on the side of the other possibilities. The alternative chosen is associated to the opportunity cost that is the higher benefit not obtained from the possibilities that were not chosen. It is the choice of a specific option that imped the acquisition of benefits that the other options could have given. The higher value associated with the benefits not chosen can be understood as the cost of the option chosen named opportunity cost.