You are shopping at the local mall with an $80 gift certificate. Only three items catch your attention. The items include a Justin Bieber sheet set, a remote control helicopter, and an "Amazing Ab Belt." You would be willing to give up $60 for the sheets, $70 for the belt, and $80 for the helicopter. Knowing this, you decide to purchase the helicopter. The opportunity cost of the helicopter was:
A. $70, the value of the ab belt.
B. $80, the amount of the gift certificate spent.
C. $130, the combined value of the alternatives forgone.
D. $60, the value of the sheets.
Answer: A
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If a monopolist owns or controls a key resource necessary for production, it is a source of:
A) legal market power. B) natural market power. C) regulated market power. D) restricted market power.
If the ATC curve has a positive slope, then the MC curve must be
A) horizontal. B) vertical. C) above the ATC curve. D) below the ATC curve.
The supply and demand model examines how prices and quantities are determined
A. by governments. B. by monopolists. C. in markets. D. by churches.
For both a monopolist and a monopolistically competitive firm:
a. price equals average total cost. b. price is above marginal revenue. c. marginal revenue equals zero. d. marginal cost equals zero.