ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The correct answer to the given question is option c. the total cash expenditure needed to go to the movie plus the value of your time. The opportunity cost of going a movie is the net benefit associated with the next best alternative forsaken by choosing to go for the movie.

Detailed explanation-2: -The opportunity cost is different. It is measured by what alternatives you are giving up by going to see a movie. While the direct cost of a movie is $8 and two hours, the opportunity cost is an additional $20 dollars if you could be working for $10 an hour during that time.

Detailed explanation-3: -A student spends three hours and $20 at the movies the night before an exam. The opportunity cost is time spent studying and that money to spend on something else. A farmer chooses to plant wheat; the opportunity cost is planting a different crop, or an alternate use of the resources (land and farm equipment).

Detailed explanation-4: -Opportunity cost refers to what you have to give up to buy what you want in terms of other goods or services. When economists use the word “cost, ” we usually mean opportunity cost.