opportunity cost

2007-09-17 5:32 am

opportunity cost
'Dad, please give me$500 to buy reference books,' asked john.
'Here you are. But you must not spend it on other things,' said Dad.

a) What is the cost to John using the $500?
B) Suppose John bought a reference book which he later finds to be useless. Has hi cost of buying the reference book increased? Briefly explain your answer.

更新1:

But John's father told hime not to use the money on the other things he didn't have the choice in using the money on the other things SO,what is his cost?

回答 (1)

用戶16820

2007-09-17 5:48 am

✔ 最佳答案

A) the opportunity cost to John using the $500 is no spending on the other things for him to buy reference books.

B) the cost of buying the reference book has not increased because the value of the forgone option does not change. His cost of buying the reference books is still $500. Only the value of the reference books decreases.

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