ECONOMICS
OPPORTUNITY COST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Marilyn has been invited to a sleep over at Jazmin’s house for this Saturday. Marilyn has tickets to see her favorite band in concert that same night. She decides to give the tickets to her sister and go to Jazmin’s house. What is the opportunity cost of her decision?
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seeing her favorite band
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spending time at a friends house
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Either A or B
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None of the above
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Explanation:
Detailed explanation-1: -When economists refer to the “opportunity cost” of a resource, they mean the value of the next-highest-valued alternative use of that resource. If, for example, you spend time and money going to a movie, you cannot spend that time at home reading a book, and you can’t spend the money on something else.
Detailed explanation-2: -The money spent on food is not a part of the opportunity cost of going on holiday. Opportunity cost of production of a commodity refers to the cost which has to be sacrificed in terms of the next best alternative which could be produced out of that cost.
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