3. In a drawing held by the Denver Broncos, a fan won the right to buy a Super B

Question

3. In a drawing held by the Denver Broncos, a fan won the right to buy a Super Bowl ticket for $1,300. The going price for a Super Bowl ticket at the time was $5,000. If the man decides to buy the two tickets at the special price how would an economist calculate how much it cost him to go to the game? Why do economists measure costs this way?

4. Why do more rich kids go to college than poor kids? Assume that each have the same level of motivation and skills. Answer this question by using the opportunity costs of going to college and constructing a cost table for both a wealthy student and a low income student.

Explanation / Answer

3.The actual cost of the man is 1300+1300=2600. If he is going he might be giving up his other work. This is the cost associated.Economists not only sees the actual cost but also sees the cost asociated with other things. This is known as opportunity cost. Now to define opportunity cost it is the sacrificing cost which is forgone for some other work. here the other work is going to Denver Broncos.

4. Rich kids go to college than poor kids as they don't have the need to support their family where as poor children after finishing school think of joining some work to support their family. By a table we can explain the opportunity cost problem.

From the above table it is clear that opportunity cost of rich going to college is high than the poor where as not going to college is higher among the poor.

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