Positive because price exceeds average variable costs. Suppose you play a round of golf costing $75. Chapter 2. D) buyers always have an opportunity to go to another seller. D)marginal revenue equals marginal cost. Multiple Choice Opportunity cost exists because a. technology is fixed at any point in time b. the law of comparative advantage is working c. resources are scarce but wants are unlimited d. the value of lost opportunities varies from person to person e. efficiency is measured by the monetary cost of an activity Click here for the SOLUTION For an individual, it may involve choosing the best from the choices available. 35-D Opportunity cost is the benefit of next best alternative forgone. If the price of coke is $1.00, the optimal number of cokes that Jane should drink is: Principles of Microeconomics by University of Victoria is licensed under a Creative Commons Attribution 4.0 International License, except where otherwise noted. I. 1.1 What Is Economics, and Why Is It Important? regardless of what is done in the future C. that which we forgo, or give up, when we make a choice or a decision. If it buys four tons per day, it receives a quantity discount on all units and pays only $175 per ton. Online Resources. 34) Output Total Revenue Total Cost 0 $0 $25 1 $30 $49 2 $60 $69 3 $90 $91 4 $120 $117 5 $150 $147 6 $180 $180 35)In the above table, the price of the product is A)$30. III. 8) Economics involves marginal analysis because: A) marginal benefits always exceed marginal costs. 1. Every month I also have the option of attending a meeting of the whiskey club (open only to Club members), at a cost per meeting of $15, payable at the beginning of each meeting. As a member of UVic’s University Club, I pay $30 per month in membership fees. Online Resources. Economists use the term . Required fields are marked *. Consumer surplus in a market for a good exists because: answer choices . He has agreed to pay 10% interest on the loan. A reduction in investment will be the opportunity cost of increased subsidies to farmers. You can resell your Kanye ticket for $80. This will mean that if we choose more of one thing, we will have to have less of something else. 37-C Opportunity cost is the benefit of next best alternative forgone. On the day of the concert, a friend offers you a free ticket to the opera instead. Microeconomics Topic 1: “Explain the concept of opportunity cost and explain why accounting profits and economic profits are not the same.” Reference: Gregory Mankiw’s Principles of Microeconomics, 2nd edition, Chapter 1 (p. 3-6) and Chapter 13 (p. 270-2). c. functional costs. II. Opportunity cost is equal to implicit costs plus explicit costs. 8) 9) Opportunity costs exist because: A) wants are scarce relative to resources. In January, in an attempt to commit to getting fit, I signed a year-long, binding contract at a local gym, agreeing to pay $40 per month in membership fees. a) I, II and III. 35-D Opportunity cost is the benefit of next best alternative forgone. ... negative opportunity cost value in an unused cell in a transportation table is chosen to improve the current solution because. C)marginal benefit. The principle of increasing opportunity cost occurs because:} A) scarcity exists. The economic concept of "opportunity cost" is most closely associated with which of the. b) I c) III only. If you were not playing golf you could be working and earning $40 per hour. 2. B. a cost that cannot be avoided. 10. Web Links. 43) 44)The opportunity cost of any action is A)the time required but not the monetary cost. Opportunity costs exist because: A) using resources for one activity means that their use elsewhere must be given up. Risk loving. C)$147. 13. B)total revenue equals total opportunity cost. You were willing to pay up to $200 for this ticket, but it only cost you $110. Opportunity cost is the potential loss owed to a missed opportunity, often because somebody chooses A over B, the possible benefit from B is foregone in favor of A. The amount a seller is paid minus the cost of production/opportunity cost . Multiple Choice Quiz. d) All of the above were relevant. Economics Mcqs for Lecturer & Subject Specialist Exams. For an individual, it may involve choosing the best from the choices available. I also spent $300 on extremely stylish gym clothes. Cost incurred due to shortage of stock is known as _____ a. Imputed cost b. Suppose that you are willing to pay $350 to see Leonard Cohen play at the Save-On-Foods Arena. Resource variability is the idea that all inputs are not equal; some are better for producing … d) I and III only. 36-B Basic economic problem arises from limited resources and unlimited wants. B. means we are unable to have as much as we would like to have. No contribution margin is generated by the transferring division when variable cost-based transfer prices are used. (A) opportunity cost (B) utility (C) marginal cost (D) scarcity 28. Operations Research Online Quiz Following quiz provides Multiple Choice Questions (MCQs) related to OS.You will have to read all the given answers and click on view answer option. Multiple Choice . Concept Check — See how you do on these multiple-choice questions. A. mathematical models B. physical models diagrammatic The number of rows equals columns b. You are willing to pay $20 to see the movie and the movie ticket costs $5. C) we must give up something to get something else. Multiple-Choice Questions. The marginal cost of the fourth … Opportunity cost: The value of the next-best alternative when a decision is made; it's what is given up. c. income taxes. ... Firms exist because they facilitate the efficient organization of factors of production. Pools of multiple-choice questions have been constructed around each question below. B. a cost that cannot be avoided. The cost of the dinner is $20 and you value the experience of having dinner with your friend at $60. C) curve that is bowed outward if increasing opportunity costs exist. a) III only. The opportunity cost of going to the movie is: 4. Your email address will not be published. What is the opportunity cost to me of the loan to my brother? This shows that she values the first coke she drinks at $1.20, the second at $1.15, and so on. 2. Balance of Payments, Aid and Foreign Investment, Characteristics and Institutions of Developing Countries, Exchange-Rate Systems And Currency Crises. B)$150. For example, a student may have to choose between doing A levels and going for a diploma right after finishing O levels. ECON 2105-2106 QUIZ 2 (CHAPTER 2) FALL 18 Multiple Choice Identify the choice that best completes the statement or answers the question 1. Which of the following statements about opportunity costs is TRUE? b) I Scarcity: A. exists because resources are limited while human wants are unlimited. C) marginal costs always exceed marginal benefits. D) resources are not equally suited to all activities. Consumers: People who buy goods and services to satisfy their wants. Some producers charge different prices for the good in different markets. c) II only. Suppose you have bought and paid for a ticket to see Lady Gaga in concert. 35) 36)In the above table, the firm D. is not an issue addressed in economics. opportunity cost. (this multiple choice question has been scrambled) The law of increasing opportunity costs exists because: A) Resources are not perfectly adaptability or substitable in producing different goods. Opportunity cost includes both explicit costs and implicit costs. The concept of scarcity, choice and opportunity cost can be shown in many ways, at different levels. All of the given options. Multiple Choice Questions 1. C. will likely be eliminated as technology continues to expand. D)$180. As production of a given good increases, opportunity cost increases because of resource variability. Solutions: Case Study - The Housing Market, Topic 4 Part 2: Applications of Supply and Demand, Solutions: Case Study - Automation in Fast Food, Introduction to Environmental Protection and Negative Externalities, Solutions: Case Study - The Liberal Gas Tax, Introduction to Cost and Industry Structure, 7.4 The Structure of Costs in the Long Run. PLEASE COMMENT BELOW WITH CORRECT ANSWER AND ITS DETAIL EXPLANATION. Opportunity cost only measures direct monetary costs. Web Links. I. Sunk costs are those that cannot be recovered, no matter what future action is taken. b) II only. to explain this behaviour. Opportunity cost c. Imputed cost d. Notional cost 42. a) The $40 that I paid the gym this month. d) All of the above. III. 1) The best definition of economics is. All x ij = 0 or 1 c. 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