A consumer budget is Rs 40 .He is buying Good 1 and Good 2. Price oo Good 1 is Rs 8 and Good 2 Rs 10 per unit.a) Draw a budget line. b)Is consumer can purchase 5 unit of Good 1 and 5 unit of Good 2? c) Show effect on budget line due to falling price of Good 1 from Rs 8 Rs 4 per unit.plzzz solve this
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Definitions and Examples of Opportunity Cost
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BY ROSEMARY PEAVLER Updated August 16, 2018
Investors are always faced with options about where to invest their money to receive the highest or safest return. The investor’s opportunity cost represents the cost of a forgone alternative. If you choose one alternative over another, then the cost of choosing that alternative becomes your opportunity cost.
If you choose not to go to work today, for example, your opportunity cost becomes your lost wages. If your friend John chooses to quit work for a whole year to go back to school, the opportunity cost of his decision is the year’s worth of lost wages.
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