Which of the Following Statements Is FALSE About Opportunity Cost

question 410

Multiple Choice

Which of the following statements is FALSE about opportunity cost?

• A) Cost is always foregone opportunity.
• B) Opportunity cost is the next best alternative.
• C) When a person buys two items, the concept of opportunity cost applies even though she can afford to buy both items.
• D) Opportunity cost exists only for goods with monetary values.

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Definitions:

Money Supply

The money supply represents the entire sum of financial assets within an economy at a given moment, encompassing cash, coins, and the amounts present in checking and savings accounts.

Managed Float System

An exchange rate system that combines features of freely floating rates with sporadic intervention by central banks.

Bretton Woods Agreement

A 1944 agreement that established fixed foreign exchange rates for major currencies, as well as the IMF and the World Bank.

Gold Standard

A monetary arrangement where the valuation of a country's currency or paper bills is pegged directly to gold.