Skip to content
MathsGenie logo
Open app

Course home

  1. A Level
  3. Economics OCR
  5. Question bank

The economic problem

EasyMediumHard
12345678910111213141516171819202122232425262728293031323334353637383940414243444546
Question 27

A regional government has been allocated a fixed infrastructure fund of £50 million. Due to scarcity, it must choose only one of four mutually exclusive development proposals. The estimated economic welfare benefits of each proposal are evaluated as follows:

  • Proposal A (High-speed rail link): £65 million
  • Proposal B (Hospital expansion): £85 million
  • Proposal C (Flood defense network): £92 million
  • Proposal D (Science and technology park): £78 million

If the regional government decides to implement the flood defense network (Proposal C), what is the opportunity cost of this decision?

£50 million

£85 million

£92 million

£228 million

The economic problem Questions

  1. A Level
  2. /Economics
  3. /The economic problem