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Anna [14]
3 years ago
5

Explain precisely why ‘Opportunity Cost’ is always a RELATIVE concept and is never to be construed in ABSOLUTE terms. In additio

n, why is the PPF function never strictly convex -what is the economic implication of strict convexity? You are free to provide appropriate examples of your choice.
Business
1 answer:
telo118 [61]3 years ago
3 0

Answer:

Opportunity costs are defined as the additional costs or benefits lost from choosing one activity or investment over another alternative. It is a relative concept because you cannot be 100% sure that the other investments or activities would have yielded a specific gain.

For example, when you calculate the economic cost of starting your own business, you consider your current salary as an opportunity cost. But what happens if you get fired (or the company closes), your opportunity cost would have been $0? Or how can you exactly measure your future salaries? Maybe in a couple of years you get promoted to manager, or maybe not?

The same applies to economies, since the opportunity cost of producing certain tradable goods is not always fixed, it might decrease or increase due to productivity or efficiency changes. But in order to calculate or determine we must include the most probable option.

In microeconomics, a strictly convex production possibilities frontier function must include a combination of both goods. In strict convexity, the second derivative f''(x) ˃ 0, so the PFF curve cannot be straight, it must have a slope.

When we calculate the opportunity costs of PPF, we usually try to determine which product has the lowest opportunity cost, but that is not an interior solution because both goods are not being produced (the curve is not strictly convex). On a strictly convex curve, as you approach the extremes the opportunity cost of producing one good is high, but on the center the opportunity cost is much lower.

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Suppose that there is only one provider of a service in a state. Because this provider experiences economies of scale, the gover
Radda [10]

Answer:

The correct answer is A

Explanation:

Monopoly is the market structure in which there is a single seller of the product and service. And the seller enjoys the freedom and does not have any competition in the market.

So, this is the case of a monopoly market structure as there is only single seller in the state. And the government regulate the monopolies so that could protect the interest of customers and adopt the policies such as merger regulations, competition in market and breaking down the monopoly.

Therefore, the government could control the prices by price capping, in which the government set the limit on the prices of the service. And in the case of monopolies have the power set the prices above the equilibrium level. Hence, it is required to regulate the price.

3 0
3 years ago
"A broker-dealer who acted as financial advisor to a municipality in structuring a new issue now wishes to act as underwriter in
maxonik [38]

Answer:

B. The financial advisor is prohibited from acting as the underwriter

Explanation:

As per the rule of the Municipal Securities Rulemaking Board, the financial advisor cannot be the underwriter.

The financial advisor for a  municipality is paying the advisory fee for assisting the structure of the municipality in order to the issuance of the new bond so that the less interest cost to be paid.

But in the case of the underwriter, it contains high rate of interest as it is very easiest way for selling

So through this, the conflict arises between these two parties

Therefore option B is correct

3 0
3 years ago
Which of the following tools is an example of monetary policy?
loris [4]

Answer:

Explanation:

B C and D have become tools that have been tried.

Deficit spending is a budget/government policy. Its use should be very limited.

Same with Increased Government Spending. FDR was the master at controlled government spending.

Reducing income taxes is another government policy.

So only A is an example of monetary policy. This is a regulation imposed on the Banks by the Federal Reserve.

4 0
3 years ago
Read 2 more answers
Select the correct answer.
Gwar [14]

Answer:

I believe the answer is B. 30 percent

<em>good luck, i hope this helps :)</em>

<em />

3 0
3 years ago
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By keeping good credit
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