Fundamental concepts in economics are

opportunity cost.

marginalism.

efficient markets.

All of the above

You have decided that you want to attend a costume ball as Batman. You estimate that it will cost $25 to assemble your costume. After spending $25 on the costume, you realize that the additional pieces you need will cos you $15 more. The marginal cost of completing the costume is

$5

$10

$15

$20

Opportunity cost is

that which we forgo, or give up, when we make a choice or a decision.

a cost that cannot be avoided, regardless of what is done in the future..

the additional cost of producing an additional unit of output.

the additional cost of buying an additional unit of a product.

The reason that opportunity costs arise is that

an economy relies on money to facilitate exchange of goods and services.

resources are scarce.

there are no alternative decisions that could be made.

people have unlimited wants.

Multiple Choice Questions

Which of the following is an example of a normative statement?

The unemployment rate is percent.

There should be no unemployment in an advanced industrial society.

Higher prices cause consumers to buy less.

Equilibrium prices implies that quantity demanded equals quantity supplied.