C. people work less and produce fewer goods and services

d. rich people consume fewer goods and poor people consume more goods, resulting in no real change.

14. In economics, the cost of something is

a. the out-of-pocket expense of obtaining it.

B. what you give up to get it.

c. always measured in units of time.

d. always higher than people think.

15. The opportunity cost of going to college is

a. the total spent on food, clothing, books, transportation, tuition, lodging, and other expenses.

b. zero for students who are fortunate enough to have all of their college expenses paid by someone else.

C. the value of the best opportunity a student gives up to attend college.

d. zero, since a college education will allow a student to earn a larger income after graduation.

16. Carolyn decides to spend an additional hour working overtime rather than watching a video with her friends. She earns $8 for her hour’s work. Her opportunity cost of working is

a. the $8 she earns.

B. the enjoyment she would have received had she watched the video.

c. the $8 minus the enjoyment she would have received from watching the video.

d. nothing, since she would have received less than $8 of enjoyment from the video.

17. Ryan spends an hour studying instead of going for a bike ride. The opportunity cost to him of studying is

a. the improvement in his grades from studying for the hour.

b. the difference between the improvement in his grades from studying minus the enjoyment of a bike ride.

C. the enjoyment and exercise he would have received had he gone for a bike ride.

d. zero. Since Ryan chose to study rather than to ride his bike, the value of studying must have been greater than the value of the bike ride.

18. People make decisions at the margin by

a. following tradition.

B. comparing costs and benefits.

c. experience.

d. calculating dollar costs.

19. A marginal change is

a. a long-term trend.

b. a large, significant adjustment.

c. a change for the worse.