Question

The law of supply relates to opportunity cost because:__________

A) The opportunity cost to suppliers is the value of the next-best alternative they had when they supplied that good.
B) The opportunity cost of that forgone opportunity tends to increase as you supply more.
C) When a consumer chooses to purchase a product, then the consumer gives up opportunity cost.
D) That opportunity cost leads to higher prices when supply increases.
E) The income and substitution effects represent the opportunity cost of supplying a certain good.
F) If prices increase, the income and substitution effects increase, leading to an increase in quantity supplied.
G) The opportunity cost to suppliers is the value of the next-best alternative they had when they supplied that good.
H) The opportunity cost of that forgone opportunity tends to decrease as you supply more.

Answer 1

Answer:C when a consumer chooses to purchase a product, then the consumer gives up opportunity cost

Explanation: opportunity cost ,is the cost of the alternative given up to purchase a particular good by a consumer while supply is the amount of good or services that a supplier is ready to sell at a particular price and time.

So the opportunity cost of an alternative or substitute determine the amount of goods that will be in demand ,i.e the higher the opportunity cost of an alternative,the more goods that will be required for purchase and the higher the the goods required to be sold by the supplier.

Answer 2

both options are the same.

A) The opportunity cost to suppliers is the value of the next-best alternative they had when they supplied that good.

or

G) The opportunity cost to suppliers is the value of the next-best alternative they had when they supplied that good.

Step-by-step explanation:

The law of supply states that the opportunity cost of a supplier not supplying the product will increase as the price of the product increases, therefore the supplier will be more likely to supply the product. As the price of the product decreases, the opportunity cost of not supplying the product also decreases, therefore, the supplier will be less likely to supply the product.