Economics 2281 · O Level · Opportunity cost

Opportunity cost — practice question

During 2020, pay received by Mexican workers, including those in the primary sector, declined. This decline helped to cause a 9% increase in poverty in the country. In that same year, many small and medium-sized firms shut. The country also experienced traffic congestion. Its capital city, Mexico City, is the world’s most congested city.
(a)[2]

Identify two possible opportunity costs of producing primary sector products.

(b)[4]

Explain two policy measures that may reduce poverty.

(c)[6]

Analyse the ways in which firm closures may damage consumers.

(d)[8]

Discuss whether a government should, or should not, encourage people to walk to school and work.

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