opportunity cost and demand

Question 1

Economists reason that the optimal decision is to continue any activity up to the point where the:

Answer 1

marginal benefit equals the marginal cost.

Question 2

If the Apple iPhone and the Samsung Galaxy are considered substitutes, then, other things being equal, an increase in the price of the iPhone will:

Answer 2

increase the demand for the Galaxy.

Question 3

What is the difference between an increase in demand and an increase in quantity demanded?

Answer 3

An increase in demand is represented by a rightward shift of the demand curve, while an increase in the quantity demanded is represented by a movement along the given demand curve

Question 4

The demand by all the consumers of a given good or service is the

Answer 4

quantity demanded

Question 5

If, in response to an increase in the price of chocolate, the quantity of chocolate demanded decreases, economists would describe this as:

Answer 5

a decrease in quantity demanded.

Question 6

By drawing a demand curve with ________ on the vertical axis and ________ on the horizontal axis, economists assume that the most important determinant of the demand for a good is the ________ of the good.

Answer 6

price; quantity; price

Question 7

what are the 2 components of opportunity cost?

Answer 7

1. monetary cost
2. time cost