Opportunity Cost Economics Quiz
Dive into the fascinating world of economics with our Opportunity Cost Quiz! Delve into the core concept of opportunity cost, where every decision involves sacrificing alternatives. Whether you're an aspiring economist or a curious learner, this quiz is your chance to explore the intricacies of resource allocation. Engage with thought-provoking scenarios and real-life examples to comprehend the implications of choices in personal, business, and societal contexts.
Test your economic acumen, compare your results, and gain insights into the true value of decision-making. Embrace the challenge, learn from each question, and unravel the art of trade-offs with our captivating Opportunity Cost Read moreEconomics Quiz!
- 1.
If a business invests in research and development instead of marketing, the potential increase in sales from marketing is the:
- A.
Direct cost
- B.
Opportunity cost
- C.
Marginal cost
- D.
Fixed cost
Correct Answer
B. Opportunity costExplanation
The potential sales increase represents the opportunity cost of the decision to invest in research and development over marketing.Rate this question:
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- 2.
If you choose to study instead of going to a movie, what is the opportunity cost?
- A.
The cost of studying
- B.
The cost of the movie ticket
- C.
The enjoyment of the movie
- D.
None of the above
Correct Answer
C. The enjoyment of the movieExplanation
The opportunity cost is the enjoyment of the movie, the next best alternative to studying.Rate this question:
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- 3.
In economics, what does the principle of scarcity lead to?
- A.
Unlimited wants
- B.
Opportunity cost
- C.
Unlimited resources
- D.
None of the above
Correct Answer
B. Opportunity costExplanation
Scarcity leads to opportunity cost as limited resources require choosing between alternatives.Rate this question:
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- 4.
What is the opportunity cost of investing in stock A instead of stock B?
- A.
The return on stock A
- B.
The return on stock B
- C.
The difference in returns
- D.
None of the above
Correct Answer
B. The return on stock BExplanation
The opportunity cost is the return on stock B, the foregone alternative.Rate this question:
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- 5.
If a company produces more of Good X and less of Good Y, what is the opportunity cost?
- A.
The cost of Good X
- B.
The cost of Good Y
- C.
The production of Good Y
- D.
The production of Good X
Correct Answer
C. The production of Good YExplanation
The opportunity cost is the production of Good Y that is given up to produce more of Good X.Rate this question:
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- 6.
What does a production possibilities curve illustrate?
- A.
Scarcity and choice
- B.
Scarcity and opportunity cost
- C.
Opportunity cost and efficiency
- D.
All of the above
Correct Answer
D. All of the aboveExplanation
A production possibilities curve illustrates scarcity, choice, opportunity cost, and efficiency.Rate this question:
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- 7.
If a student spends an hour playing instead of studying, what is the opportunity cost?
- A.
The fun of playing
- B.
The grade in the exam
- C.
The time spent playing
- D.
None of the above
Correct Answer
B. The grade in the examExplanation
The opportunity cost is the grade in the exam, the next best alternative to playing.Rate this question:
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- 8.
What does a point inside the production possibilities curve represent?
- A.
Efficiency
- B.
Inefficiency
- C.
Opportunity cost
- D.
None of the above
Correct Answer
B. InefficiencyExplanation
A point inside the curve represents inefficiency, as resources are not being fully utilized.Rate this question:
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- 9.
If a country specializes in the production of a good, what is the opportunity cost?
- A.
The goods not produced
- B.
The cost of production
- C.
The revenue from the good
- D.
None of the above
Correct Answer
A. The goods not producedExplanation
The opportunity cost is the goods not produced, as resources are allocated to the specialized good.Rate this question:
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- 10.
What is the opportunity cost of saving money instead of spending it?
- A.
The interest earned
- B.
The items not purchased
- C.
The total savings
- D.
None of the above
Correct Answer
B. The items not purchasedExplanation
The opportunity cost is the items not purchased, the foregone alternative to saving.Rate this question:
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- 11.
If a business invests in new equipment, what is the opportunity cost?
- A.
The cost of the equipment
- B.
The benefits of the equipment
- C.
The alternative investments
- D.
None of the above
Correct Answer
C. The alternative investmentsExplanation
The opportunity cost is the alternative investments that could have been made instead of buying the equipment.Rate this question:
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- 12.
What is the opportunity cost of attending college full-time instead of working?
- A.
The cost of tuition
- B.
The potential earnings from working
- C.
The degree earned
- D.
None of the above
Correct Answer
B. The potential earnings from workingExplanation
The opportunity cost is the potential earnings from working, the foregone alternative to attending college.Rate this question:
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- 13.
If a farmer grows wheat instead of corn, what is the opportunity cost?
- A.
The cost of growing wheat
- B.
The cost of growing corn
- C.
The amount of corn not grown
- D.
None of the above
Correct Answer
C. The amount of corn not grownExplanation
The opportunity cost is the amount of corn not grown, the foregone alternative to growing wheat.Rate this question:
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- 14.
What is the opportunity cost of spending time on leisure activities instead of working?
- A.
The enjoyment of leisure
- B.
The income not earned
- C.
The time spent on leisure
- D.
None of the above
Correct Answer
B. The income not earnedExplanation
The opportunity cost is the income not earned, the foregone alternative to leisure activities.Rate this question:
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- 15.
If a government spends more on defense and less on education, what is the opportunity cost?
- A.
The cost of defense
- B.
The cost of education
- C.
The spending on education
- D.
None of the above
Correct Answer
C. The spending on educationExplanation
The opportunity cost is the spending on education, the foregone alternative to spending on defense.Rate this question:
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Current Version
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Dec 22, 2023Quiz Edited by
ProProfs Editorial Team -
Nov 14, 2012Quiz Created by
Lmckinney
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