Understanding Scarcity and Opportunity Cost in Goods

Steps:

• Define economic goods as scarce resources requiring choices and involving trade-offs.
• Define free goods as abundant resources, like air, with unlimited supply.
• Identify opportunity cost as the value of the next best alternative forgone.
• Evaluate each statement against these definitions to find the accurate one.

Why D is correct:

• Free goods, by definition, are not scarce, so using them incurs no opportunity cost since no alternatives are sacrificed.

Why the others are wrong:

• A: Economic goods are scarce by definition, requiring allocation decisions.
• B: Economic goods are scarce, so they always involve opportunity cost.
• C: Free goods are not scarce; they exist in unlimited quantities.

Final answer: D