Suppose that you own a house. What is the opportunity cost of living in the house?
A. There is no opportunity cost because you own the house.
B. There is no opportunity cost unless you could set up a business in the house.
C. The opportunity cost is the rent you could have received from a tenant if you didn't live there.
D. The opportunity cost is the cost of your monthly mortgage payment plus bills.
Answer: C
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One hundred percent reserve banking refers to a situation in which banks' reserves equal 100 percent of their:
A. profits. B. loans. C. deposits. D. income.
Refer to the figure above. What is the total surplus after Lithasia opens up to free trade?
A) $15 B) $25 C) $27 D) $35
The revenue curves that a monopoly faces are different from those that a perfectly competitive firm faces in that the:
A. marginal revenue curve is downward sloping instead of flat. B. average revenue curve is no longer equal to price. C. marginal revenue curve is now flat instead of downward sloping. D. total revenue curve for a monopoly is linear.
One reason that the quantity demanded of a good increases when its price falls is that the:
A. price decline shifts the supply curve to the left. B. lower price shifts the demand curve to the left. C. lower price shifts the demand curve to the right. D. lower price increases the real incomes of buyers, enabling them to buy more.