4
QuizMultiple Choice

Opportunity Cost — Quiz

Question 4 • Personal Finance

Imagine the US government chooses to spend more money on transportation than on all other areas combined. What would most likely be the opportunity cost of this decision?

Answer
A
The United States government would have to postpone some public transportation projects.
B
The United States government would construct a first-rate national public transportation system.
C
The United States government would have less money in the budget for health care and education.
D
The United States government would spend more money on education and health care.

Explanation

An opportunity cost is the value of the next-best alternative given up when a choice is made. If the government spends more on transportation than on all other areas combined, less money is available for other priorities, such as health care and education. Therefore, the likely opportunity cost is having less budget money for those services.

AI-written and checked against the verified answer.

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