Question 1 a. What is the distinction between a money price and a relative price?
The value of the goods and services in terms of money is called money price and the value of goods and services in terms of other goods and services is called relative price.

b. Explain why relative price is an opportunity cost?
Relative price is the price of goods and services in comparison to another and opportunity cost is the best alternative you give up when you do something. Thus both rrelative price and opportunity cost of a commodity is calculated considering the cost of other alternatives. So, we can say relative price is an opportunity cost. c. Goods whose relative price has risen or fallen by a large amount in recent times.
In Scotland there is rise of finance marked from £17.7 billion to 18.8 billion, a rise of 6% from a year earlier. But the traditional lending to business has fallen 2 % from 383 billion in 2014 to 375 this year.
Question 2 a. Define the quantity demanded of a good or services.
Quantity demanded of a goods and services is the quantity of a goods and services that people are willing to buy at a particular price at a particular point of time.

b. What is the law of demand and how do we illustrate it?
According to law of demand, other tings remaining constant, if the price of the commodity falls, the quantity demanded of it will rise and if the price of the commodity rises, its quantity demanded will decline. Thus, there is an inverse relationship between price and commodity demanded other things remaining same. We illustrate law of demand by using demand schedule and demand curve.

c. What does the demand curve tell us about the price that consumers are willing to pay?
The demand curve shows the inverse relationship between the quantity demanded of a goods and services and its price when other things like income, taste,