Suppose your college institutes a new policy requiring you to pay for a permit to park your car in a campus parking lot
a. The cost of the parking permit is not part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
b. The cost of the parking permit is part of the opportunity cost of attending college if you would not have to pay for parking otherwise.
c. Only half of the cost of the parking permit is part of the opportunity cost of attending college.
d. The cost of the parking permit is not part of the opportunity cost of attending college under any circumstances.
b
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All other things unchanged, higher saving rates contribute to higher rates of capital formation.
a. true b. false
Economists Milton Friedman and E.S. Phelps suggested that the apparent trade-off suggested by the Phillips curve could not be exploited by policy makers, because
A) economic participants routinely incorporate changes in the inflation rate into their expectations. B) economic participants are not rational, and therefore act unpredictably to any policy change. C) unemployment levels and the inflation rate have a clear, positive relationship. D) unemployment levels and the inflation rate have a negative (inverse) relationship.