Which of the following demonstrates opportunity cost?
A. With a new strain of wheat, the wheat crop of Canada grows by 20% with no change in the productive resources devoted to wheat farming.
B. A tax cut increases people's purchases of consumer goods and decreases state expenditures on education.
C. The ravages of World War II reduced Japan's ability to produce goods.
D. Flora gets a 10% raise and increases her expenditures on movies.
B. A tax cut increases people's purchases of consumer goods and decreases state expenditures on education.
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The demand for a good is less price elastic
A) if closer substitutes are available. B) if the good is a luxury rather than a necessity. C) if the share of the good in the average consumer's budget is smaller. D) in the long run than in the short run.
The least costly way to clean up the environment is for all firms to reduce pollution by an equal percentage
a. True b. False Indicate whether the statement is true or false
_____ is an example of a black market activity
a. Purchasing weapons in an alley b. Purchasing cars from an authorized dealer c. Purchasing furniture from a shop d. Purchasing drugs from a pharmacy
Suppose you are planning to open a lemonade stand. List separately all the explicit and implicit costs that might be involved