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Home› UPSC CSE› Prelims GS Paper I› 2018 questions› Question 42

UPSC CSE Prelims

Subject: Economy Chapter: Basic Economic Concepts

2018 PYQ

Question 42

If a commodity is provided free to the public by the Government, then

Choose one answer Athe opportunity cost is zero. Bthe opportunity cost is ignored. Cthe opportunity cost is transferred from the consumers of the product to the tax-paying public. Dthe opportunity cost is transferred from the consumers of the product to the Government.

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View correct answer and explanation

Correct answer: C

Correct Option: C Explanation: Providing a service or commodity free to its user does not remove scarcity or the resources forgone. The burden of financing ordinarily shifts to public funds and taxpayers. Option-wise Analysis: A: Incorrect - Opportunity cost still exists because resources have alternative uses. B: Incorrect - It cannot simply be ignored in economic analysis. C: Correct - Correct-the cost burden moves from the direct user to the tax-paying public. D: Incorrect - “Government” is not an ultimate source of resources independent of the public; the option obscures who finances it.

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