Question

Which of the following best reflects the principle of increasing marginal opportunity cost (or the law of diminishing returns)?

Question 1 options:

	Two more hours studying per week could raise your grade from a C to a B, but to raise it from a B to an A, would require 7 hours more studying per week
	Two hamburgers cost twice as much as one hamburger
	A large soda costs more than a small soda
	Marginal costs increase whenever marginal benefits do

Answer 1

Law of increasing marginal opportunity cost indicates that as more and more units of a particular good are produced the opportunity cost goes on increasing. This indicates that increasing the grade from one level to another initially will have a lower marginal opportunity cost but, because higher grades require higher number of study hours, marginal opportunity cost goes on increasing for higher grades. in case of hamburgers the marginal opportunity cost is same. The same is true for soda

First option is correct