1.3 opportunity cost

Question 1

define opportunity cost

Answer 1

the next best alternative forgone

Question 2

influence of opportunity cost on consumers

Answer 2

• choose between what products to purchase
• the larger the opportunity cost, the harder the decision

Question 3

influence of opportunity cost on workers

Answer 3

• choice on what job to undertake
• larger opportunity cost of being in one job, may resign and undertake diff job

Question 4

influence of opportunity cost on producers

Answer 4

• deciding what to produce
• choose option with maximum profit

Question 5

influence of opportunity cost and the government

Answer 5

• expenditure of tax revenue

Question 6

do economic goods have opportunity cost? why

Answer 6

• yes
• resources are used to produce
• production involves opportunity cost

Question 7

do free goods have opportunity cost? why

Answer 7

• no
• no resources used to produce