Society must pay the full opportunity cost of any activity
A. that causes costs to rise.
B. that uses scarce resources.
C. that increases revenues.
D. none of these.
Answer: B
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A rightward shift in the aggregate demand curve is most likely to result in
A. deflation. B. recession. C. inflation. D. decrease in employment.
If a firm invests a lot in new employees, it is likely to
A) forward load compensation. B) pay all the costs of the new training. C) backload compensation. D) none of these choices.
The Golden Rule is an example of a private solution for
a. subsidizing higher education. b. internalizing externalities. c. increasing production. d. reducing scarcity.
Suppose a bond promises to pay its holder $100 a year forever. The interest rate on the bond rises from 4 percent to 5 percent. The price of the bond
A) falls from $2,500 to $2,000. B) does not change because it is not affected by the interest rate. C) falls from $25,000 to $20,000. D) rises from $2,000 to $2,500.