Which of the following does not illustrate opportunity cost?
a. If I study, I must give up going to the football game.
b. If I buy a computer, I must do without a 35" television.
c. If I spend more on clothes, I must spend less on food.
d. All of these illustrate opportunity cost.
d
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Explain risk and liquidity of assets
What will be an ideal response?
The opportunity cost of an action includes: a. the monetary expenses incurred as a result of the action
b. the highest valued alternative use of the time spent on the action. c. the benefits received as a result of the action. d. only a. and b.
Any business wanting to attract financial capital must expect to
A) earn a positive economic profit. B) keep implicit costs as close to zero as possible. C) pay a normal rate of return. D) pay a below normal rate of return in order to make a positive rate of return itself.
There is a possibility that a national sales tax will be implemented. Many economists argue that items such as food and clothing should be exempt from such a tax because low-income people spend a greater percentage of their income on these goods than do high-income individuals. This argument is motivated by concerns over
A. efficiency. B. economic growth. C. economic stability. D. equity.