ECONOMICS (CBSE/UGC NET)

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ECONOMICS

PRODUCTIVE RESOURCES

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Nick’s boss called to ask if he could cover another employee’s shift on Friday night. However, Nick said that he was busy because he had already made plans with his friends to go to dinner and see a movie. He spent $15.00 on dinner and another $10.00 to see the movie. He would have earned $40.00 had he taken the extra shift.What is the opportunity cost of going to dinner and seeing a movie?
A
$10.00
B
$15.00
C
$25.00
D
$40.00
Explanation: 

Detailed explanation-1: -In a production possibility curve, unemployment will be shown as a point inside the curve. All the points on the curve show that all the resources in the economy are being fully utilized in an efficient manner.

Detailed explanation-2: -An increase in the number professionally qualified persons, the production possibility frontier will shift outward.

Detailed explanation-3: -The correct answer is b. decrease in the size of the labor force. This shifts the production possibility curve inward. A decrease in the size of the labor force leads to less labor stock and it leads to the production possibility curve shifting inward.

Detailed explanation-4: -Production possibilities analysis is fundamental to economics. Economists describe the true cost of something as what you must give up in order to get that thing. This can be seen in the concept of opportunity cost, which is the value of the next best alternative not chosen.

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