Cost Concepts
Economics ⇒ Consumer and Producer Behaviour
Cost Concepts starts at 11 and continues till grade 12.
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See sample questions for grade 11
Define the term 'cost' in economics.
Explain the concept of explicit cost with an example.
Explain the concept of opportunity cost with an example.
Explain the concept of social cost with an example.
Explain the difference between short-run and long-run cost curves.
Explain the relationship between average variable cost and average total cost.
State whether the following is a fixed or variable cost: Salary of permanent staff.
What is meant by marginal cost?
Which of the following costs is relevant for future decision making? (1) Sunk cost (2) Opportunity cost (3) Fixed cost (4) Past cost
Which of the following is a sunk cost? (1) Payment for raw materials (2) Cost of advertising already done (3) Wages paid to workers (4) Rent for next month
Which of the following is a variable cost? (1) Rent of factory (2) Raw materials (3) Insurance premium (4) Depreciation of machinery
Which of the following is an example of an explicit cost? (1) Wages paid to workers (2) Interest on own capital (3) Estimated rent of self-owned building (4) Opportunity cost of time
Fill in the blank: ______ cost is the cost per unit of output.
Fill in the blank: Average total cost = Average variable cost + ______ cost.
Fill in the blank: Social cost = Private cost + ______ cost.
Fill in the blank: The cost incurred on the purchase of raw materials is a ______ cost.
State whether the following is true or false: In the short run, all costs are variable.
State whether the following is true or false: Opportunity cost is always a monetary cost.
State whether the following statement is true or false: In the long run, all costs are variable.
State whether the following statement is true or false: Marginal cost can be negative.
