Question

Directions: Answer the question as completely as possible. You are expected to write a paragraph explaining what you would do and why. You must use the terms correctly in the paragraph demonstrating you understand them, not just listing them. ECONOMIC VOCABULARY: You have a choice: You are not sure where to go to college but you know that you will go. You are debating between staying in Illinois (in-state tuition) and going somewhere warm. It will be cheaper to stay in Illinois, as you will be paying more for out-of-state tuition. However, you love warm weather and want to experience new things and a new city. Your parents prefer that you stay in-state and want to help you pay for college, and they are afraid of you taking on too much student loan debt (In fact, you are beginning to worry about this yourself). Think like an economist and make your decision using at least FIVE of the following terms (please underline them): incentives, opportunity cost, no free lunch, cost-benefit analysis, utility, scarcity, positive economic statement, normative economic statement, microeconomics, and macroeconomics.

Answer 1

To make a decision about college using economic concepts, consider opportunity cost, incentives, and cost-benefit analysis.

Step-by-step explanation:

In making a decision whether to stay in Illinois for college or go somewhere warm, you can think like an economist by considering several economic concepts. One important concept to consider is opportunity cost. By staying in Illinois, you will pay less for tuition, but you will miss out on the experience of living in a new city and experiencing warm weather. This is the opportunity cost of choosing Illinois. Another concept to consider is incentives. Your parents prefer that you stay in-state and are willing to help you pay for college. This provides you with an incentive to choose Illinois. Cost-benefit analysis is another useful concept to consider. You should weigh the cost of out-of-state tuition against the benefits of experiencing new things and a new city.