Question 1

Opportunity cost is defined

Accepted Answer

Opportunity cost is defined as the value of the best alternative not chosen. Therefore, the best choice is the one that has the lowest opportunity cost, which means it is the option with the best trade-off between benefits and alternatives not chosen.

Question 2

Expenses for room and board

Accepted Answer

Room and board expenses are not usually considered as part of the opportunity cost of attending college because they are expenses that you would have to incur regardless of whether or not you attend college. It is important to consider only those expenses that are directly related to attending college when calculating the opportunity cost.

Question 3

The opportunity cost of an activity is

Accepted Answer

The opportunity cost is the value of the best alternative not chosen. This is because when making a choice, you are giving up the benefits of the next best alternative. Therefore, the opportunity cost is the cost of the foregone alternative.

Question 4

Opportunity cost is the difference between the benefits and the costs of a choice.

Accepted Answer

The answer of Opportunity cost is the difference between the...

Question 5

Opportunity cost is always measured in dollar terms, rather than in terms of real goods and services.

Accepted Answer

Opportunity cost can be measured in terms of both dollar value and real goods and services. The cost of choosing one option over another is the value of the next-best alternative that must be given up. This can be a monetary cost or the value of the benefits that would have been received from the alternative option.

Question 6

The opportunity cost of college is the same for all students who are receiving full-tuition scholarships.

Accepted Answer

The opportunity cost of college varies among students receiving full-tuition scholarships depending on their individual circumstances and potential alternative opportunities they may have pursued if they were not in college.

Question 7

A rational decision maker engages in an activity if that activity is more attractive than the best alternative.

Accepted Answer

This statement is true according to the definition of rational decision making. A rational decision maker evaluates the options available to them and chooses the one that is most attractive compared to the others.

Question 8

Upon graduating from high school you have a job offer which would provide you with $20,000 in income for the coming year. You have also been accepted to Isaac and Avery college. Tuition for the coming year at I&A college is $15,000, room and board is $10,000 and you expect that books will cost you $2,000. What is the opportunity cost of attending I&A college?

Accepted Answer

The opportunity cost of attending I&A college is the income you would have earned if you had not attended college. In this case, the opportunity cost is $20,000, which is the amount you would have earned if you had taken the job offer.

Question 9

The opportunity cost of going to college is best measured by the

Accepted Answer

The opportunity cost of going to college is not only the cost of tuition and room and board, but also the income that could have been earned if the individual had not gone to college and instead worked during that time. Therefore, the correct answer is D, which includes the income forgone by not working in addition to the cost of tuition.

Question 10

The Sultan of Brunei, one of the world's richest people, does not face the problem of scarcity.

Accepted Answer

The answer of The Sultan of Brunei, one of the...

Question 11

Your opportunity cost of choosing a particular activity

Accepted Answer

The opportunity cost of choosing a particular activity varies depending on the time and circumstances. For example, choosing to watch a movie instead of studying for an exam may have a different opportunity cost than choosing to go out with friends instead of doing household chores. The opportunity cost is not always easily quantifiable and can depend on individual preferences and values.

Question 12

The opportunity cost of going to college includes the costs of tuition, books, fees, and

Accepted Answer

The answer of The opportunity cost of going to college...

Question 13

Opportunity cost is objective; therefore, its value does not change as circumstances change.

Accepted Answer

Opportunity cost is subjective and can vary based on individual preferences and circumstances.

Question 14

The opportunity cost of an activity

Accepted Answer

Opportunity cost is subjective and varies from person to person based on individual values and opinions. Therefore, the best choice will depend on each individual's unique circumstances and priorities.

Question 15

Suppose you have an hour before your next class starts. You can either read a book, get something to eat, or take a nap. The opportunity cost of getting something to eat is

Accepted Answer

The answer of Suppose you have an hour before your...

Question 16

The cost of attending college

Accepted Answer

The cost of attending college includes both monetary expenses (tuition, books, transportation, meals) as well as the opportunity cost of not working or pursuing other alternatives. The most valued alternative given up (such as potential income from a job) is what makes up the true cost of attending college.

Question 17

Opportunity cost exists because

Accepted Answer

Opportunity cost exists because resources are scarce but wants are unlimited. This means that when we choose to do something, we are giving up the opportunity to do something else. The cost of the foregone opportunity is the opportunity cost. This concept is important in economics because it helps us understand the true cost of a decision and the trade-offs we have to make in a world of limited resources.

Question 18

A test was scheduled for Monday morning, but you went to a party on Saturday night. If you hadn't attended the party, you could have studied for the test or gone to a movie. Which of the following is true?

Accepted Answer

The answer of A test was scheduled for Monday morning,...

Question 19

Which economic concept does the expression "time is money" reflect?

Accepted Answer

The expression "time is money" reflects the economic concept of opportunity cost, which means the value of the next best alternative that must be given up in order to pursue a certain action. In this case, the time spent on one activity is time that cannot be spent on another activity, and therefore has an opportunity cost in terms of lost potential benefits or earnings.

Question 20

Suppose you have a choice of working full-time during the summer or going full-time to summer school. Summer tuition and books are $2,200. If you worked, you could make $7,000. Your rent is $1,000 for the summer, regardless of your choice. The opportunity cost of going to summer school is, therefore,

Accepted Answer

The answer of Suppose you have a choice of working...

Quiz 3: Economic Tools and Economics Systems