Opportunity Cost

Front

The economic problem is that

Back

resources are limited and wants are unlimited.

Front

The opportunity cost of a good is

Back

the alternative goods forgone.

Front

The opportunity cost of Australian households moving away from coal-powered energy to solar-powered energy includes (i) the loss of jobs in the coal industry, (ii) a cleaner environment, (iii) reduced coal production.

Back

(i) and (iii)

Front

A firm operating at 'X' produces 70 whips and 60 saddles. It changes production to 'Y' producing 20 whips and 90 saddles. The opportunity cost of this production change is

Back

50 whips

Front

The production possibility curve shows

Back

alternative combinations of two goods that an economy is capable of producing.

Front

If an economy is producing at a point inside its production possibility curve, then

Back

productive resources are not used to their full potential.

Front

When a country’s people and all its other resources are fully employed, what must be true before more of any one item can be produced?

Back

Less of another good or goods must be produced.

Front

In terms of the production possibility curve, a decrease in unemployment would be best shown by

Back

a movement from a point inside the curve to a point closer to the curve.