ECONOMICS
SCARCITY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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paying the fee
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paying for something else
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finishing the book
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reading a different book
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Detailed explanation-1: -When Amy returns a good library book without finishing it so she won’t have to pay a late fee. What is her opportunity cost? She doesn’t get to finish the book.
Detailed explanation-2: -For example, choosing public transportation to travel to a particular destination by foregoing the option of traveling in one’s own car is a good example of opportunity cost, because you end up saving money which needs to be spent on fuel.
Detailed explanation-3: -It exists because human wants for goods and services exceed the quantity of goods and services that can be produced using all available resources.
Detailed explanation-4: -The opportunity cost of a decision is the value of the next best alternative that is forgone in favor of the chosen option. In other words, it is what you give up when you make a choice. Opportunity cost is a key concept in economics and decision-making.