Free

Economic Questions: Opportunity Cost - Assignment Example

Summary

The author examines an opportunity cost which refers to the benefits or value of a thing that needs to be given up in order to achieve something else. In simpler terms, opportunity cost refers to what needs to be forgone to be able to achieve something else. …

Download full paper File format: .doc, available for editing

GRAB THE BEST PAPER96% of users find it useful

Read Text Preview

Subject: Macro & Microeconomics
Type: Assignment
Level: High School
Pages: 1 (250 words)
Downloads: 5
Author: raujasper

Extract of sample "Economic Questions: Opportunity Cost"

If an individual requires to judge whether a holiday is a better option or buying a DIY set is a better option (based on their economic condition), then the benefits of both need to be weighed and based on this the individual can make a more informed decision. Consumers need to ensure that their money is invested in an area which had a higher return and proves to be more beneficial based on their economic condition and for that period of time. Hence opportunity costs allow consumers to make more informed decisions (McConnell, Brue, & Flynn, 2008).

While understanding the concept of Production Possibility curve, it is essential to learn in detail the possible outcomes and combinations that need to be produced within the economic resources that are available in the period. This can be clearly noted as the PPC tends to provide the maximum outcomes which help give a clearer idea of the law of diminishing returns.

CHECK THESE SAMPLES OF Economic Questions: Opportunity Cost

Time constrained assessment

Economic Problem and the Concept of opportunity cost using the Production Possibility Frontier In the Dictionary of Economics (Collin 2006, 58), the concept of economics is defined as “the study of the production, distribution, selling and use of goods and services” or “the financial study of financial structures to show how a product or service is costed and what returns it produces”.... In economics, this concept of the value, people refuse from, is known as the opportunity cost (Wessels 2006, 3)....

4 Pages (1000 words) Essay

Opportunity Cost as Transaction Costs

Transaction Costs (development and definitions) and opportunity cost (developments and definition), once these have been identified opportunity cost should then be linked into transaction costs, i.... As there is an opportunity cost associated with every transaction, opportunity… In order for a business to proceed to a decision regarding a specific area of its activities, there should be the criteria that have to be met in order for the above procedure to be considered as completed....

15 Pages (3750 words) Essay

Economics 20 multiple choice questions |(NO woRD COUNT)

DO NOT SUBMIT THE QUESTION PAPER to the undergraduate office. 19.... A car dealer wants to get rid of the stock of last year's… Assume that the dealer knows from past experience that the price elasticity of demand for cars is unitary (= -1).... If the price of the cars is currently £20,000 and the dealer wants to increase the quantity demanded from 30 units to 50 units, what must the new price be if At price OP the consumer spends the amount OPRQ....

4 Pages (1000 words) Essay

Economics questions

This phenomenon can be understood using the concept of moral hazard, in that customers who perceive the warranty to be “free” or included in the price of the good, might have purchased a refrigerator with or without a warranty, experience the cost of using that warranty once they have purchased the good to be zero.... Therefore, problems that might otherwise have been tolerated (such as cosmetic defects), or repaired at the cost of the consumer (such as small parts) are now reportable, warranty-covered repairs....

4 Pages (1000 words) Assignment

Case-1 Thinking like an economist: The basic vocabulary of the field

opportunity cost of the chosen firmIn order to pursue an action, the cost of the available alternative that was not taken into account is called opportunity cost (Mankiw, 2009).... The costs associated with building up furniture and other utensils as well as costs associated with initial supply of food and beverages constitute the second type of cost.... The other available opportunity costs include the owner could have start his own business with new brand name....

2 Pages (500 words) Essay

Questions in the Economics 2010 Course

Implicit cost: It is the intangible cost that is hard to account for and can be thought of as opportunity cost.... opportunity cost: opportunity cost is the cost that somebody suffers for choosing the alternative decision over the other and it is always considered that the best choice is made between the options; the lesser privileged choice is foregone to pursue the other for more benefits to be yielded.... Companies obtain economic profit when the price of the goods sold is higher than the opportunity cost which is not an effective strategy while accounting profit is defined as the totals earning of the company which includes even inflation and interest rates....

4 Pages (1000 words) Assignment

Economic Profit

Economic profit is a better measure of profit than accounting profit because it considers opportunity cost and other hidden costs which are ignored by accounting profit (Black, 2003).... This attracts more customers Economic Profit Question Added value = value of products or services – cost of producing such products or providing the servicesMicrosoftAdded value = value of output – wages and salaries – cost of materials – cost of capitalAdded value = 2,750 – 400 – 1,650 – 40Added value = $660Barclays bankAdded value = $5,730 – 3,953 – 916 – 556 = $305General MotorsAdded Value = 50,091 – 29,052 – 15,528 – 7,507 = -$1996Question 5 Economic profit is a better measure of profit than accounting profit because it considers opportunity cost and other hidden costs which are ignored by accounting profit (Black, 2003)....

1 Pages (250 words) Essay

Opportunity Cost

100,000 0 0 1000 The opportunity cost of 1000 television sets is 100,000 bushels of corn, therefore opportunity cost of producing a television set is given as,(1 x 100,000)/1000100The opportunity cost of 100,000 bushels of corn is 10,000 television sets, therefore the opportunity cost of a bushel of corn in this country is giving as,(1 x 1000)/ 100,0000.... 150,0000015,000The opportunity cost 150,000 bushels of corn is 15,000 television sets, therefore the opportunity cost of a bushel of corn will be given as,(1 x 15000)/150,0000....

1 Pages (250 words) Assignment