Define opportunity cost. Given the definition of opportunity cost, explain what is meant by the statement "There is no such thing as a free lunch."
What will be an ideal response?
Opportunity cost is what we give up, or forgo, when we make a choice. There
is no such thing as a free lunch because everything involves a cost, even if it
is just a time cost.
You might also like to view...
Suppose the United Automobile Workers union agrees to accept lower wages for members if the automobile manufacturers lower their prices to buyers
Will the UAW's measures usually result in a larger number of cars being sold and hence more jobs for UAW members? A) No, because people only buy new cars when they need them. B) Not if the price elasticity of demand for new cars turns out to be less than one. C) Only in the unlikely event the demand for new cars is unit elastic. D) Probably not, because new car sales depend on advertising. E) Yes.
People buy insurance
a. because they are risk averse. b. to defer consumption. c. because of externalities. d. to maximize their welfare. e. to ensure against poor health.
Camila is a homemaker. Last week, she was busy with her normal household activities. How would the Bureau of Labor Statistics classify her?
a. A member of the civilian labor force who is employed. b. A member of the civilian labor force who is unemployed. c. A member of the civilian labor force who is underemployed. d. A discouraged worker who is not a member of the labor force. e. Not a member of the labor force.
If an externality is present in a market, economic efficiency may be enhanced by
a. increased competition. b. weakening property rights. c. better informed market participants. d. government intervention.