Q. If a commodity is provided free to the public by the Government, then
Answer: the opportunity cost is transferred from the consumers of the product to the tax-paying public.
Notes: The correct answer is [C] the opportunity cost is transferred from the consumers of the product to the tax-paying public. This is a fundamental concept in economics reflecting that "there is no such thing as a free lunch."

• Definition of Opportunity Cost: It is the value of the next best alternative foregone when a choice is made. Even if a commodity (like healthcare or education) is provided "free" at the point of consumption, the resources used to produce it (land, labor, capital) could have been used elsewhere.
• Transfer of Cost (Statement C – Correct): While the individual consumer pays zero price, the cost of production is covered by the government using fiscal resources. Since the primary source of government revenue is taxes, the burden of the opportunity cost is shifted from the specific user to the general tax-paying public.
• Why Option [D] is less accurate: While the government physically manages the funds, it acts as an intermediary. The actual economic resources are diverted from the taxpayers who could have used that money for private consumption or investment.
• Zero Opportunity Cost (Statement A – Incorrect): Opportunity cost is zero only for "free goods" like air or sunlight, which are abundant and do not require a choice of resource allocation. For any man-made commodity, the opportunity cost is never zero.

Economic Implication: When the government provides a service for free, the opportunity cost is the value of other public projects (like roads or defense) that were sacrificed to fund that specific commodity.