ASSIGNMENT 4: ECONOMICS 1A QUESTION 1 in each of the cases next to each number.

Question

ASSIGNMENT 4: ECONOMICS 1A QUESTION 1 in each of the cases next to each number. Eg. 1.11 a 00) following cases only one answer is correct. Write the letter that represents the correct ansarer 1.1 Which one of the following statements is incorrect? 5) Our wants are unlimited b) Our needs are limited. ) A typical example of market demand is a demand (claim) by a trade union for increased wages d) People demand only the things that they want 12 The diagram below vehicles. Use this diagram to answer the question below shows an economy's production possibilities for two goods aeroplanes and motor economys Motor vehicles With reference to the above production possibilities frontier, we can say that a) The opportunity cost of producing 0a motor vehicles is Ob aeroplanes The opportunity cost of producing one more motor vehicle is higher at f than at g c) The opportunity cost of producing one more aeroplane is higher at g than at f d) The opportunity cost of producing 0a motor vehicles is cb aeroplanes 1.3 in the market for pubilic transport, which of the following variables would decrease demand, ceteris paribus? a) An increase in the price of private motor vehicles (b) A decrease in the price of private motor vehicles c) An increase d) A decrease in the price of bus tyres motor vehicle service plans in price of private Y 2018 INTAKE

Explanation / Answer

1.1) c is correct

Demand by union for higher wages is not an economic demand. Demand is the quantity that the consumer is willing to buy at a specific price.

1.2) d is correct

Opportunity cost of producing one good is the units of another good that has to be sacrificed. To produce Oa units of motor vehicle, cb units of aeroplanes have to be sacrificed.

1.3) b is correct

Private motor vehicle and public transport are substitutes. If price of one decreases demand for other falls.

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