GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following describes theopportunity cost to an economy of buildinga new airport?
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The extra cost of providingequipment and managers tooperate the airport efficiently.
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The closure of the airport itreplaces.
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The goods and services that couldhave been produced instead ofthe airport.
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The increase in taxation to thecitizens to pay for the newairport.
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Explanation:
Detailed explanation-1: -The opportunity cost of an aircraft carrier can be found by equating the quantities of the two products: 55, 000 airliners = 5, 000 carriers. Therefore 1 carrier = 55, 000 / 5, 000 = 11 airliners. Therefore the opportunity cost of a carrier is 11 jumbo airliners.
Detailed explanation-2: -When governments invest scarce resources in encouraging the development of tourism they forego the opportunity to invest that money in other, perhaps more productive, ways. This is known as opportunity cost. It does appear that investments in tourism yield returns comparable to returns in other industries.
There is 1 question to complete.