What is meant by the term opportunity cost?
What will be an ideal response?
Opportunity cost is the highest-valued alternative that must be given up to engage in an activity.
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Which of the following is a rival good that is nonexcludable?
a. public good b. private good c. common resource d. none of the above
Figure 4-20
Refer to . The price that sellers receive after the tax is imposed is
a.
$8.
b.
$6.
c.
$5.
d.
$3.
Refer to the tables below. Assume that prior to specialization and trade Germany and the United States both choose production possibility C. Now if each specializes according to its comparative advantage, the resulting gains from specialization and trade will be:
Autos and chemicals are in million of units in the following production possibilities tables:
A. 8 million units of autos
B. 6 million units of autos
C. 6 million units of autos and 8 million units of chemicals
D. 8 million units of autos and 6 million units of chemicals
The price elasticity of demand for new cars is 1.2. Hence, a 10 percent price increase will
A) decrease the quantity of new cars demanded by 1.2 percent. B) increase consumer expenditure on new cars by 1.2 percent. C) decrease the quantity of new cars demanded by 12 percent. D) increase consumer expenditure on new cars by 12 percent.