Cost-Benefit Analysis- Micro Topic 1.5

  • Published on Aug 29, 2019
  • Hey internet! This is Jacob Clifford. In this episode I explain explicit and implicit benefits and costs. I also define utility and explain the idea of cost-benefit analysis.
    The answers to the practice questions are in the comments below. Be sure to let me know how you did on the quiz AND if you understand why the guy that went to his girlfriends movie still picked teh option that he wanted to do. Also, let me know how much you would accept for your dog (or cat or parakeet). Thanks for watching my econ video. You rock!
    Our song

Comments • 48

  • Jacob Clifford
    Jacob Clifford  2 months ago +18

    The answers to the practice questions are below. Just click on "Read more". Be sure to leave a comment and let me if you understand why that guy was wrong about the movies.

    1. D
    2. E
    3. D
    Thank you for subscribing!

    • Sandie J
      Sandie J 7 days ago

      Jacob Clifford i got it right yayy!!! Thank you for the course well explain in less than 10 minutes .

    • rodrigo jimenez
      rodrigo jimenez Month ago

      Hey Jacob> ! i dont agree with your answers . I believe in the first case oportunity cost of atending college is 12.000 per year ( or lets say 24.000 ). And the oportunity cost of attending the concert should be 40 . I mean you are considering explcit or direct cost as oportunity cost as well. I mean , the hole equation of "economic cost" may be 90 bucks for atending the concert but only 40 bucks should be consider as the oportunity cost. Am i right??

      i didnt get the second question , probably luck of english skills.

    • Chris Park
      Chris Park 2 months ago

      @Michelle Lucic Peggy is giving up 12,000 dollars that's she would have been making from the entire year of not having to go to school, and she is also paying 4600 dollars in order to attend community college.

    • Michelle Lucic
      Michelle Lucic 2 months ago +2

      I still don't understand why the answer to 1 is D. Please help

    • Siyuan Zhang
      Siyuan Zhang 2 months ago

      that guy forego the fiction movie for potential future benefit with this girl. It's implicit cost that's not monetary or tangible but intrinsic and inherent with his "utility", or "happiness". Correct me if I'm wrong!

  • Celeste Paerels
    Celeste Paerels 16 hours ago

    Could anyone help me with quiz questions 1 and 3? Isn't the opportunity cost the next best option (which in the case of question 1 is the job with the offered salary of $12,000 per year)? Or is the opportunity cost both the implicit and explicit costs?

  • Care Cup
    Care Cup 2 months ago +2

    Because the benefit of hitting his girlfriend later that night outweighed the cost of having to go watch her dumb movie.

    TONY BALONEY DIRTY WHITES 2 months ago +1

    I actually said dog feces

  • Cheeplestase
    Cheeplestase 2 months ago

    Passed the BEC section of the CPA exam in part thanks to your material. Thanks!

  • Khavin Sivatharan
    Khavin Sivatharan 2 months ago

    Clifford, I need help with my economics homework, can you help me

  • Mr. Franco Athos
    Mr. Franco Athos 2 months ago

    Un bon week-end mon cher Jacob... ♫
    avoir beaucoup de joies ... ♫♫
    J'aime ta vidéo ..

  • Wisani Kenny
    Wisani Kenny 2 months ago

    He made the decision because he weighed the cost of her getting angry at him and the benefit of pleasing himself by watching what he wanted to watch. Obviously, if he forced watching what he wanted to watch, she'd get angry and he'd have to apologize, perhaps even spend money he would otherwise save for other things; the cost was higher than the benefit. So it doesn't disprove that fact because he actually wanted to please his girlfriend.

  • Splithoof Rivera
    Splithoof Rivera 2 months ago

    I'm studying to be an economist and honestly it's just for the jokes. Why do accountants have such bad jokes and why are we so much better at them?

  • Vladyslav D.
    Vladyslav D. 2 months ago

    Shouldn't the answer to the first question be: 12000$ x 2 (It's a 2-year program, so Peggy gives up 2 years of work) + 4600$ = 28 600‬$?

    • Vladyslav D.
      Vladyslav D. 2 months ago

      @Jacob Clifford Got it. I have to improve my English before learning economics 😅 Thanks for the answer.

    • Jacob Clifford
      Jacob Clifford  2 months ago +1

      I see what you are saying, but it asked for the ANNUAL opportunity cost

  • Kelvin Hau
    Kelvin Hau 2 months ago

    I bought the 12$ videos and study guide a year ago. I am now taking microeconomics again in college. The playlist i bookmarked does not exist anymore. Guess I'll need to hunt for the videos in the right order.

  • A K
    A K 2 months ago

    Thank you for the super helpful video :)))

  • A K
    A K 2 months ago

    Nah boi i would rather eat poison than chili peppers smh

  • Avantika S.
    Avantika S. 2 months ago

    are these videos and the ultimate review packet all updated for the new ap micro curriculm??

  • Slow-wipe
    Slow-wipe 2 months ago

    Press F in chat for our teach that just ate a spoon full of mayo for this video

  • Junaid Rizvi
    Junaid Rizvi 2 months ago

    Ans is 12000

    • Junaid Rizvi
      Junaid Rizvi 2 months ago

      @Jacob Clifford ok. Thanks for the reply Mr. Clifford. You are simply great👍

    • Jacob Clifford
      Jacob Clifford  2 months ago

      Nope. Check the key

  • siddhartha jain
    siddhartha jain 2 months ago +1

    Best part was penny story.

  • Sushant
    Sushant 2 months ago +1

    The opportunity cost would be 12000 since that is the money you would be giving up to attend college. We need not include the tuition in opportunity cost.

    • Jorge Tamayo
      Jorge Tamayo 2 months ago

      I'm also not the biggest fan of this question either but i've used it in class and explain that the money could have been used for something other, therefore it has an opportunity cost. IMO, a better suited question would have been to ask about the economic costs (which includes both explicit and implicit costs) rather than opportunity costs.

    • Jacob Clifford
      Jacob Clifford  2 months ago

      Check the key.

    • Voltaire's Army
      Voltaire's Army 2 months ago

      Yes, factoring in the cost of tuition wouldn't be straightforward anyway. How much is taken as a loan? How would we factor in the interest payments? Would we use data to estimate it? Make assumptions about the loan and repayment schedule?

  • Family Guy Now!
    Family Guy Now! 2 months ago

    The answer is C because u are giving up 12000 at the job and you would still have to pay tuition fee of 4600 so u are giving up 12000 and also 4600 to go to college so the opportunity cost is 12000+4600=16600

    • Steven Klurfeld
      Steven Klurfeld 2 months ago

      @Family Guy Now! The issue is, the explicit cost of the tuitiion is $4600, the implicit costs are $12000, the value of the salary she would have the total opportunity cost, what was given up is $16600. I used to teach this within the accounting vs Economic profit topic...not sure what happened to that

    • Family Guy Now!
      Family Guy Now! 2 months ago

      Yes I mean d

    • Family Guy Now!
      Family Guy Now! 2 months ago

      Sorry my bad

    • Family Guy Now!
      Family Guy Now! 2 months ago

      Oh I see its 2 year not one

    • Family Guy Now!
      Family Guy Now! 2 months ago

      Could you explain

  • Sora No Kiseki
    Sora No Kiseki 2 months ago +4

    I still have the 20 billion Zimbabwe dollar you give me when you visited Charlotte!

  • Ken
    Ken 2 months ago +1

    I'll be taking AP Macro starting Wednesday. This should be pretty interesting.

  • Mohamed Magdi
    Mohamed Magdi 2 months ago +1

    Missed your videos alot ❤❤❤❤

  • Subhi Youssef
    Subhi Youssef 2 months ago

    12000+4600 = 16600

  • Subhi Youssef
    Subhi Youssef 2 months ago

    whiching your vido maximizing the utilty to time
    good luck

  • GucciGav
    GucciGav 2 months ago +11

    The boyfriend accepted the cost today in return for a benefit in the future (hopefully with interest adjusted)

    • rodrigo jimenez
      rodrigo jimenez Month ago +1

      actually , the boyfriend perceived a higher benefit on seeing her girlfriend enjoy the movie she liked , (or just in avoiding a potential argue), than the benefit he perceived on actually enjoying his movie of choice.
      In terms of costs, the boyfriend perceived a higher cost on letting her girlfriend down than in watching a bad movie.

  • Dylan OSoGood
    Dylan OSoGood 2 months ago +1


  • cpcheats2003
    cpcheats2003 2 months ago +18

    Just dropping in to say that your ultimate review packet was worth every penny! :D