ECONOMICS
SCARCITY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The money spent on tuition
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Interest payments on student loans
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Money spent on textbooks
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Foregone wages given up to attend college
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Money spent on clothes
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Detailed explanation-1: -The correct answer is d) The money a student spends on rent for his apartment while attending school. The other options are alternatives to going to school. However, regardless of whether the student goes to school or not, they still have to pay rent on the place they live in. Therefore, that’s not an opportunity cost.
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.
Detailed explanation-3: -In short, the opportunity cost of going to college is the cost of tuition, any associated costs, and any income, experience, and pleasure you miss out on because you choose to attend college.
Detailed explanation-4: -The opportunity costs of attending college do NOT include: required student activity fees. the expenditures for food. the forgone wages that could have been earned working.