The opportunity cost of a good is______________?
Correct answer: B. the quantity of other goods sacrificed to get another unit of that good
- A. the time lost in finding it
- B. the quantity of other goods sacrificed to get another unit of that good
- C. the expenditure on the good
- D. the loss of interest in using savings
Explanation
Opportunity cost is the value of the best alternative forgone, commonly expressed as the quantity of another good sacrificed to obtain one more unit. It is therefore not merely the money spent on the good.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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