Suppose a student has 3 hours of time to spend at her apartment before afternoon classes. She has the option of doing laundry, studying for a test, or watching television. If she decides to do laundry, then her opportunity cost isA) watching televisionB) studying for the testC) watching television and studying for the testD) either watching television or studying for the test, whichever would have been her second choice to doing laundry

Question

Melody Fitzgerald

Business

24 March, 15:57

Suppose a student has 3 hours of time to spend at her apartment before afternoon classes. She has the option of doing laundry, studying for a test, or watching television. If she decides to do laundry, then her opportunity cost isA) watching televisionB) studying for the testC) watching television and studying for the testD) either watching television or studying for the test, whichever would have been her second choice to doing laundry

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Answers (1)

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Kaylah · Answer 1

The correct answer is option D.

Explanation:

The opportunity cost of a decision can be defined as the cost of foregoing the second-best alternative. In other words, the benefit that could have been earned if the alternative was not given up.

Here, time is the scarce resource and its uses are doing laundry, studying for a test or watching television. If the student chooses to do laundry her opportunity cost will be either watching television or studying, whichever was her second-best choice.