The Opportunity Cost of a One-Unit Increase in an Activity

question 249

Multiple Choice

The opportunity cost of a one-unit increase in an activity

• A)decreases as you do more of it.
• B)is measured by what the person is willing to give up to get one more unit of the activity.
• C)is greater than the marginal benefit.
• D)is called rational cost.
• E)is called marginal cost.

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Definitions:

Income Statement

A financial report that shows a company's revenues, expenses, and profits over a specific period, providing insight into its operational efficiency.

Unearned Revenue

Amounts received for goods or services that have not yet been provided, recorded as a liability until the service or product is delivered.

Liability

An obligation or debt that a company must pay in the future, arising from past transactions or events.

Credit

An accounting entry that increases a liability or equity account, or decreases an asset or expense account.