1. Kristen makes $200 a day at a bank. She takes off two days of work without pa
ID: 1136610 • Letter: 1
Question
1. Kristen makes $200 a day at a bank. She takes off two days of work without pay to fly with her friends to another city to attend the concert of her favorite music group. The cost of transportation for the trip is $200. The cost of the concert ticket is $50. The opportunity cost of Tammie's trip to the concert is:
A. $250 B. $400 C. $600 D. $650
2. In one day, Sue can change the oil on 20 cars or change the tires on 40 cars. In one day, Fred can change the oil on 30 cars or change the tires on 40 cars. Sue's opportunity cost of changing oil is __________ than Fred's and her opportunity cost for changing tires is ____________ than Fred's.
A. greater; greater B. less; less C. less; greater D. greater; less
Explanation / Answer
1. B. $400
Explanation: Opportunity cost is what is foregone in order to select another alternative. In order to attend the concert, Kristen needs to forego 2 days' wages, which is $200 * 2 = $400.
2. D. Greater; less
Explanation:
Sue's opportunity cost of changing oil in one unit of car is changing tires in 40/20 = 2 units of cars
Sue's opportunity cost of changing tires in one unit of car is changing oil in 20/40 = 0.50 units of cars
Fred's opportunity cost of changing oil in one unit of car is changing tires in 40/30 = 1.33 units of cars
Fred's opportunity cost of changing tires in one unit of car is changing oil in 30/40 = 0.75 units of cars
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.