Why do opportunity costs increase as society produces more of a good?
What will be an ideal response?
As society produces more of a good, ever-increasing quantities of other goods and services must be sacrificed or given up. This occurs mostly because there is difficulty experienced in moving resources from one industry to another. The mix of factor inputs also has an impact and may restrict output capabilities.
You might also like to view...
International trade does all the following except
a. allow a country to specialize in producing certain goods and services. b. reduce world output. c. allow a country to move to higher consumption levels. d. increase world output.
The reason unemployment claims are a good leading indicator of economic activity is that they reflect
A. Industry layoffs and hiring. B. Automatic stabilizers. C. Orders for new goods. D. Hours worked per week.
At a price of $20, a store can sell 24 picture frames a day. At a price of $18 the store can sell 33 picture frames a day. Since total revenue ________ by the price decrease, demand must be ________.
A. is increased; inelastic B. is decreased; elastic C. is increased; elastic D. is increased; unit elastic
Refer to the information provided in Table 33.5 below to answer the question(s) that follow. Cashews are measured in bushels and tea is measured in pounds (lbs.)
Table 33.5
Refer to Table 33.5. In India, the opportunity cost of
A. a lb. of tea is 1/6 of a bushel of cashews. B. a lb. of tea is 1/5 of a bushel of cashews. C. a bushel of cashews is 6 lbs. of tea. D. a bushel of cashews is 5 lbs. of tea.