Paper 2 Q2 |verified| - Hkcee 2010 Econ

Students often confuse "free of charge" with a "free good." In economics, if producing or consuming a good requires giving up something else (opportunity cost), it remains an economic good even if the price is $0. Correct Answer & Rationale

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Even if a firm provides a "free" sample, they use resources (labor, materials) that could have been used elsewhere. Therefore, it is an economic good. Why Students Struggled Students often confuse "free of charge" with a "free good