Which of the Following Choices Correctly Illustrates How Changes in Opportunity

question 80

Multiple Choice

Which of the following choices correctly illustrates how changes in opportunity costs affect supply?

• A) A farmer produces corn and wheat. The price of wheat rises; so he shifts his resources towards wheat and the supply of wheat rises.
• B) A fisherman fishes for lobsters and oysters. The price of lobsters rises; so he decides to spend more of his time fishing for oysters because he can make the same amount of money with fewer lobsters.
• C) A textbook for economics becomes cheaper; so more students opt to buy that particular textbook.
• D) Milk and cereal are complementary goods; so when the price of cereal falls, the quantity supplied of milk rises.

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Definitions:

Regression Analysis

A statistical technique that models the association between a dependent variable and one or more independent variables.

Sales Data

Information collected about the sales performance of a company or product.

Advertising Data

Information collected about the performance, reach, and impact of advertising campaigns.

Least Squares Estimate

A mathematical method used to determine the best-fitting line or curve to a set of data points by minimizing the sum of the squares of the differences between the observed values and the values provided by the model.