please answer question 6 ! acP the right econl un ught a $10 tic ught a $10 tick

Question

please answer question 6 !

acP the right econl un ught a $10 tic ught a $10 ticket in advance for a lacrosse ve bo 6. You ha s game, a ticke a ticket that cannot be resold. You know that going to the lacrosse game will give you a benefit equal to $20. After you have bought the ticket, vou hear that there will be a CFL football game at the same time. Tickets to the football game cost $20, and you know that going to the football game will give you a benefit equal to $35. You tell your friends the following: "If I had known about the football game before buying the ticket to the lacrosse game, I would have gone to the football game instead. But now that I already have the ticket to the lacrosse game, it's bet- ter for me to just go to the lacrosse game." Are you making the correct decision? Justify your answer by you calculating the benefits and costs of your decision.

Explanation / Answer

Yes, the decision is right. it is shown as follows:

If he goes for football game,

cost already incurred = $10

Cost yet to be incurred = $20

hence total cost involved = $30

Benefit = $35

Net benfit = $35-30 = $5

If he goes to lacroose game only, cost is $10

Benefit = $20

Net benefit = $10 (20-10)

Since net benefit is larger if he goes for lacrooose game, his decision is right.

Since benefit is still larger than total cost involved, he should go for Lacroose game

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