Opportunity cost

A farmer decides to grow potatoes instead of wheat. What is the opportunity cost of growing the potatoes?

• the output of wheat

• the price of seed potatoes

• the profit from growing potatoes

• the time spent preparing the potato field

Which statement explains why the pay of doctors is usually higher than the pay of hospital cleaners?

• Doctors have a higher opportunity cost in qualifications

• Doctors have a more elastic supply than hospital cleaners.

• Hospital cleaners belong to trade unions with stronger bargaining powers

• Hospital cleaners have a more inelastic demand than doctors

A student decides to buy a ticket for a concert instead of buying a new shirt. What is the opportunity cost of buying the ticket?

• the concert

• the price of the ticket to the concert

• the shirt

• the time spent purchasing the ticket

In recent years more golf courses, which use large quantities of water, have opened in China. What is the opportunity cost of this?

• cost of water

• loss of farmland

• sales of golf equipment

• wages of golf course staff

A farmer reduces the land used to grow wheat from 80 acres to 60 acres and increases the use of the land for growing potatoes from 80 to 100 acres. What is the opportunity cost of this change?

• The output from 20 acres used for growing potatoes.

• The output from 20 acres used for growing wheat.

• The output from 60 acres used for growing wheat.

• The output from 80 acres used for growing potatoes.

The Norwegian government chose to spend the profits from oil on stocks, bonds and property. The possibility of improving domestic infrastructure, therefore, was not taken. Which economic concept does this best illustrate?

• cost of production

• finite resources

• opportunity cost

• production possibility frontier

In economics, natural sunlight is classified as a free good. What is the reason for this?

• Sunlight is a gift of nature

• Sunlight is a renewable resource

• There is no opportunity cost of using sunlight

• Unlimited amounts of sunlight can be consumed.

A government decides to spend more on defense and cannot spend money on a new airport. Is this opportunity cost?

• yes

• no