Opportunity cost in economics

When a commodity is provided free by the Government, the opportunity cost does not disappear or become zero - it still exists as the resources used for that commodity could have been used elsewhere. Rather, the cost is shifted or transferred. Since the government funds this through taxation, the opportunity cost is transferred from the direct consumers (who pay nothing) to the tax-paying public at large. For example, free public education uses resources that could have produced other goods. Option (a) is incorrect because opportunity cost always exists. Option (b) is incorrect as the cost cannot be ignored. Option (d) is incorrect because the government itself doesn't bear the cost - taxpayers do. The economic resources devoted to free provision still have an opportunity cost borne by the broader society through taxation. > Key principle: Free goods ≠ Zero opportunity cost; cost shifts to tax-payers. Answer: (c).