What do economists mean when they say that "there is no such thing as a free lunch?"
What will be an ideal response?
Everything has a cost, even when you do not pay money for it. Suppose that somebody bought you lunch. Resources from the economy were used to make that lunch, even though those resources may not belong to you. Consequently, the economy gave up anything else it could have made with the resources it used to make the lunch. The opportunity cost of that lunch is the lost opportunity to use those resources in some other way.
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The elasticity of demand for Dell computers is probably
A) inelastic and smaller than the elasticity of demand for computers overall. B) elastic and smaller than the elasticity of demand for computers overall. C) inelastic but larger than the elasticity of demand for computers overall. D) elastic and larger than the elasticity of demand for computers overall.
All the costs of a transaction are referred to as
A) transfer costs. B) transactions costs. C) marketing expenditures. D) accounting costs.
Which of the following is likely to have the shortest long run?
A) a nail salon B) a construction firm C) an electric company D) a container ship operations company
The law of increasing opportunity cost explains why
a. opportunity cost is constant along the production possibilities frontier b. the production possibilities frontier is downward sloping c. the production possibilities frontier is curved d. efficient points lie along the production possibilities frontier e. technology remains constant along a production possibilities frontier