Neco Model Questions Vol1 2022 Economics Question 1

Practice essay / theory question 1 from the 2022 Neco Model Questions Vol1 Economics examination. This question covers Opportunity Cost, Scarcity, Marginal Utility .

Neco Model Questions Vol1 2022 Economics Essay / Theory

Topics: Opportunity Cost Scarcity Marginal Utility

Question 1 NECO_MODEL_QUESTIONS_VOL1 • 2022 • ECONOMICS • essay

A small bakery has a single oven that can be used either to bake loaves of bread or to bake pastries. The owner can produce a maximum of 200 loaves of bread per day if the oven is used solely for bread, or a maximum of 150 pastries per day if the oven is used solely for pastries.

Question Parts

( a )

Define opportunity cost and illustrate it with the bakery’s choice between bread and pastries.

( b )

Explain how scarcity of the oven’s capacity creates the need for choice in the bakery’s production plan.

( c )

Discuss how the concept of marginal utility influences a consumer’s decision to purchase bread instead of rice, assuming both are staple foods.

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About This Question

This is Neco Model Questions Vol1 2022 Economics Question 1. It is one of the essay questions from the 2022 Neco Model Questions Vol1 Economics examination.

The question covers Opportunity Cost, Scarcity, Marginal Utility .

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