ECONOMICS (CBSE/UGC NET)

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ECONOMICS

OPPORTUNITY COST

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Ronald went to a candy store. He really wanted a chocolate bar, jelly beans, and licorice.He only had enough money purchase one of them. His ranking of candy is as follows:1. Jelly Beans, 2. Licorice, 3. Chocolate bar. He decided to buy some Jelly Beans. What was his opportunity cost?
A
Chocolate Bar and Licorice
B
Jelly Beans
C
Licorice
D
None of the above
Explanation: 

Detailed explanation-1: -What are some other examples of opportunity cost? A student spends three hours and $20 at the movies the night before an exam. The opportunity cost is time spent studying and that money to spend on something else.

Detailed explanation-2: -Opportunity cost is calculated by applying the following formula: Opportunity Cost = Return on Most Profitable Investment Choice-Return on Investment Chosen to Pursue.

Detailed explanation-3: -Lesson 5: The law of increasing opportunity cost: As you increase the production of one good, the opportunity cost to produce the additional good will increase. First, remember that opportunity cost is the value of the next-best alternative when a decision is made; it’s what is given up.

Detailed explanation-4: -The opportunity cost of moving from point A to point B is 10 units of capital goods (100−90). Was this answer helpful?

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