AP Macroeconomics : How to find diagrams
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Example Question #1 : How To Find Diagrams
Which of the following explanations best represent the concept of opportunity costs?
It is the sum of all explicit and implicit costs in all of the alternatives foregone to produce the good
It is the sum of all the implicit costs represented in all the alternative opportunities foregone in the production of a good
None of the other options
It includes the explicit costs included in the production of a good, which include all the payments made to the factors of production.
It is the cost of the next best alternative that could be pursued with the resources used to produce a good
It is the cost of the next best alternative that could be pursued with the resources used to produce a good
The definition of the opportunity cost is the value of the highest valued alternative that is foregone in the production of a good. It is not the sum of all the alternative options, but rather only the most highly valued one.
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