Haberler's theory of opportunity cost represented by
(a)
Indifference curve
(b) Isoquants
(C) Supply curve
ta) Production possibility curves
Answers
Explanation:
Gottfried Haberler has attempted to restate the comparative costs in terms of opportunity cost. He demonstrates that the doctrine of comparative costs can hold valid even if the labour theory of value is discarded. The theory determines the cost of producing a commodity in terms of the alternative production that has to be foregone for producing the commodity in question.
Gottfried Haberler has attempted to restate the comparative costs in terms of opportunity cost. He demonstrates that the doctrine of comparative costs can hold valid even if the labour theory of value is discarded. The theory determines the cost of producing a commodity in terms of the alternative production that has to be foregone for producing the commodity in question.Elaborating upon the opportunity cost, Haberler writes that “the marginal cost of a given quantity X of a commodity A must be regarded as that quantity of commodity B which must be foregone in order that X, instead of (X-1) units of A can be produced. The exchange ratio on the market between A and B must equal their costs in this sense of the terms.