Question

4. An opportunity cost that a business might face is

a. forgoing the interest that the owners could have earned on their savings if they had not
invested their savings in the business
Ob. forgoing rental income to be earned if the business rented out its building
forgoing the salaries the owners would have received at other jobs
OC.
c.
Od.
d. all of the above
5. The difference between macroeconomics and microeconomics is that
a. microeconomics studies inflation while macroeconomics studies taxes
Economics
b. macroeconomics looks at the economy as a whole while microeconomics looks at single
units in the economy
Oc. macroeconomics measures the price of a good and quantity demanded while
microeconomics looks
at things like unemployment or GDP
Od.
d. macroeconomics looks at single units in the economy while microeconomics looks at the
economy as a whole

Answer 1

4. The correct answer is a. Forgoing the interest that the owners could have earned on their savings if they had not invested their savings in the business. Opportunity cost refers to the cost of forgoing the next best alternative when making a decision. In this case, the opportunity cost of investing savings in a business is the interest that could have been earned if the savings were invested elsewhere.

5. The correct answer is b. Macroeconomics looks at the economy as a whole while microeconomics looks at single units in the economy. Macroeconomics is concerned with the overall performance of the economy, including issues such as inflation, unemployment, and economic growth. Microeconomics, on the other hand, focuses on individual units within the economy, such as households, firms, and markets.