Question

9) Opportunity cost is A) the additional cost of buying an additional unit of a product ) the additional cost of producing an additional unit of output C) a cost that cannot be avoided, regardless of what is done in the future. D) that which we forgo, or give up, when we make a choice or a 10) 10) Consider the following economic agents: a· the government b consumers c producers Who, in a centrally planned economy, decides what goods and services will be produced with the scarce resources available in that economy? A) consumers and producers B) the govermment, consumers and producers C) the govemment D) consumers E) producers Figure 1-4 Total Revenue Quantity 11) Refer to Figure 1-4. Which of the following statements is false? A) The slope of the tangent at F is negative B) The slope of the tangent at E and the slope of the tangent at Fare equal. C) The slope of the tangent at E is positive. D) Neither the slope of the tangent at E nor the slope of the tangent at Fare equal to zero.

Answer 1

9.

Answer: D

This is the give-up cost if choices are made. Suppose there are two alternatives; if one is chosen and the other is foregone, the benefit out of the foregone alternative is opportunity cost.

10.

Answer: C

The government has to take decision, since this is a centrally planned economy. In this economy, the government has the supreme power to decide which are to be produced and in how much. Consumers and producers have no control over it.

11.

Answer: B

These are not equal. E is positively slopped, since it is upward moving from left to right. F is negatively slopped, since it is downward moving from left to right. Therefore, they are not equal.