Question

There is no such thing as a free lunch because:

a. whoever pays for lunch will always make you pay in some way
b. someone must always pay for limited resources
c. price is always greater than zero
d. there are always opportunity costs
e. scarcity does not always exist

Answer 1

The term 'there is no such thing as a free lunch' addresses the economic principle that nothing is truly without cost due to scarcity and the existence of opportunity costs in every choice made. The correct answer is option d.

Step-by-step explanation:

The phrase “there is no such thing as a free lunch” means that there are always costs associated with any choice, even those that appear to be “free.” This concept is tied to the economic principles of scarcity and opportunity costs. When a business offers something like a “free appetizer,” they must compensate for this cost elsewhere, typically by raising prices on other items, meaning that customers still pay indirectly. Moreover, because resources are limited and wants are unlimited, all individuals are faced with making choices involving tradeoffs, where selecting one option incurs the cost of not selecting the next best alternative, which is known as opportunity cost.