Question

The opportunity cost of attending college is likely to be highest for a high school graduate Choose one: A who is very intelligent B. who can immediately take over the family business. C. who has access to student loans. O D. whose family is extremely wealthy

Answer 1

The opportunity cost of attending college is likely to be highest for a high school graduate B) Who can immediately take over the family business.

( Opportunity cost is the loss of other alternatives when one alternative is chosen. Opportunity cost attending college is highest for the student who can immediately take over the family business because to attend the college he will have to forgo the earning that he could have earned in family business.)

In the real world, resources are limited and wants are unlimited.

( There is scarcity of resources. Hence, in real world resources are limited. On the other hand human wants are unlimited.

You have always thought that the learning to play the guitar would be fun. However, this activity would cost money and require time away from other activities. This is an example of C) trade-offs.

(Learning to play guitar involves the trade-off because the same time could have other uses as well.)

An engineer hires an exterminator. What economic concept is at work here? A) Comparative advantage

(Exterminator can do the work in which he has specialization. It need not be done by engineer. Therefore, the concept that is at work here is comparative advantage.)