thank you for this. the sound quality is crystal clear and it was well explained. I wish it was as easy to measure opportunity cost for service based businesses.
I'm confused on how the supply curve measures opportunity cost. To my understanding, opportunity cost is the amount of goods or services that must be forgone to produce, buy, or sell something. Supply curve measures the amount of goods and services supplied to markets at different prices. So, the supply curve also indicates that in order for a producer to sell a certain amount of goods and services, the price must be a certain amount in order for it to be worth selling the goods and services. But what I don't get is when you say, " the opportunity cost for 2000 ibs of berry is 2 dollars per pound." How is that an opportunity cost?
it would cost the supplier $2000 in other opportunities. Say the supplier wanted to use his land to have a corn maze. This would've generated $2000. For him to use his land to grow berries, he would have to make at least $2000, in order to make up for his opportunity cost that he lost by not making a corn maze.
Bro, did you found the answer for your question. If so please explain. I think he just assumed this as cost curve instead of supply curve for better understanding.
the opportunity cost for producing 2000 lbs of berries is the area under the supply (marginal cost) curve, it is the amount of money that the producer would've given up depending on the market price for berries i.e. the y-axis (per lbs) the producer could've used the land for something else. but based on how sal outlined it, the farmer deemed the production of 2000 lbs for a market price of 2 dollars per pound worthwhile. basically demand curve = marginal benefit curve supply curve = marginal cost curve the area below the demand (marginal benefit) curve is the benefit (usually measured in price) that the consumer gets by consuming or by buying a product the area below the supply (marginal cost) curve is the cost (usually measured in price) that the producer incurs by producing or by selling a product
This is only possible when the old inventory is sold at current market prices .....i mean the price hasn't jumped at once , it has gradually adapted itself for equilibrium , why would we have producer surplus then ?
Khan Academy is one of the greatest online resources available. Keep it up!
Really, when I had micro 1 year ago, i didnt get anything...but now, u really make me love it! :D
thank you for this. the sound quality is crystal clear and it was well explained. I wish it was as easy to measure opportunity cost for service based businesses.
with your help I'll ace my economics exam, thank you!!!
thank you
Per year Khan..per year..
OK UNDERSTOOD😭
why is it per "Week" at the end? isnt it per year?
That confused me too , I think they probably just meant year??
thank
this makes sense, thanks bro!!
Every time i hear your voice and whenever you use exclamation on particular words, you sound a bit like Bane from The dark knight.
It's very easy to understand. Thank you so much. Hope that you will upload more videos about economic lessons like this. @@
6:47 is it because the first one thousand pounds is included in the 4000 pounds that will be sold for 4 dollars?
Its per year but other than that thx
i cannot imagine what is producer or consumer surplus look like in reality.
THANK KIDS
as the seller, our goal should be to minimise consumer surplus and maximise producer surplus right?
I have an urgent question..Explain the changes in consumer surplus,producer surplus, government revenue, welfare loss and allocative efficiency.
I'm confused on how the supply curve measures opportunity cost. To my understanding, opportunity cost is the amount of goods or services that must be forgone to produce, buy, or sell something. Supply curve measures the amount of goods and services supplied to markets at different prices. So, the supply curve also indicates that in order for a producer to sell a certain amount of goods and services, the price must be a certain amount in order for it to be worth selling the goods and services. But what I don't get is when you say, " the opportunity cost for 2000 ibs of berry is 2 dollars per pound." How is that an opportunity cost?
Michael Faryab no one reply you lol
+Michael Faryab an opportunity cost is the opportunity lost from choosing the next best allternative.
it would cost the supplier $2000 in other opportunities. Say the supplier wanted to use his land to have a corn maze. This would've generated $2000. For him to use his land to grow berries, he would have to make at least $2000, in order to make up for his opportunity cost that he lost by not making a corn maze.
Bro, did you found the answer for your question. If so please explain. I think he just assumed this as cost curve instead of supply curve for better understanding.
the opportunity cost for producing 2000 lbs of berries is the area under the supply (marginal cost) curve, it is the amount of money that the producer would've given up depending on the market price for berries i.e. the y-axis (per lbs)
the producer could've used the land for something else. but based on how sal outlined it, the farmer deemed the production of 2000 lbs for a market price of 2 dollars per pound worthwhile.
basically
demand curve = marginal benefit curve
supply curve = marginal cost curve
the area below the demand (marginal benefit) curve is the benefit (usually measured in price) that the consumer gets by consuming or by buying a product
the area below the supply (marginal cost) curve is the cost (usually measured in price) that the producer incurs by producing or by selling a product
This is only possible when the old inventory is sold at current market prices .....i mean the price hasn't jumped at once , it has gradually adapted itself for equilibrium , why would we have producer surplus then ?
count the area of triangle
Awesome video! And a really nice drawing program. What program are you using?
Google class
@ultort It sais per year.
so when they produce more than 4 000 lbs quantity they don't make any more profit?
Why did you divide by 2 at the end
per week ? or per year ?
Per year. Sorry for late reply was busy
@@dustyshop90 lol 7 years later.
he can finally ace his econ exam successfully, 7 years later...
since when u need economy at Hogwarts ?!
not understandable
what is the app used
i can really use this for my economics class
Mspaint :D
Thank