Multiple Choice
Which of the following is a consequence of scarcity?
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0. Basic Principles of Economics
Scarcity and Choice
Multiple Choice
A(n) ____ cost is the potential benefit lost by taking an action instead of an alternative action.
A
opportunity
B
sunk
C
fixed
D
explicit
Verified step by step guidance1
Understand the concept of different types of costs in microeconomics: explicit costs, fixed costs, sunk costs, and opportunity costs.
Recall that explicit costs are direct, out-of-pocket payments for resources used in production.
Recognize that fixed costs are costs that do not change with the level of output, such as rent or salaries.
Know that sunk costs are costs that have already been incurred and cannot be recovered.
Identify that the cost described as the potential benefit lost by choosing one action over another is called the opportunity cost.
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