To make these deliveries, you use an old truck you own. The below table shows their Production possibilities schedules, which describe various combinations of fishing... Mountain Mack and Big Lake Bob spend their time carving fishing lures and duck decoys. An opportunity cost is: a. the cost incurred to gain the opportunity to make a sale. We have made it easy for you to find a PDF Ebooks without any digging. 24 dozen roses c. 50 dozen roses d. 150 dozen roses. a. tuition at a state university. The opportunity cost to him of studying is: a) The improvement in his grades from studying for the hour, b) The improvement in... Ramona decides to spend two hours taking a nap rather than attending her classes. Should use appropriate models/graphs: Opportunity cost. a. What is the opportunity cost (in terms of hats you could have produced) of increasing your sca... You will knit for 8 hours today. Suppose after graduating from college you get a job working at a bank earning $30,000 per year. His neighbor Diana tells him that he can "save a lot" by frequenting a gas station 20 miles outside the neighborhood where the pric... Give some real-life examples of opportunity cost. (x) The opportunity cost of the first 50 tables is 400 chairs and the opportunity cost of the first 800 chairs is 20 tables. When Lucy chose a major, she likely thought about her skills. Your opportunity cost of taking an educational course is: A. the tuition you paid for the course. C. the ne... For any given benefit, a rational person chooses the option that has: A. the lowest opportunity cost. The opportunity cost of any activity can be measured by the a. value of the best alternative to that activity. Shonda, who lives in Manhattan decides to go to a Broadway show (which is within a walking distance from her apartment). The wages he could have earned.... Mallory has a 10-month-old baby. a. These questions are from Chapter 1 Section 2. 1 hat costs a half of a shirt. 4/3 bushels of corn B. B. the sum of its explicit costs and its implicit costs. b) the cost of a government educational loan program. Suppose the Navy is buying 100 new computers to replace older and slower computers across a few bases. Give an example. B. explicit costs of inputs such as labor. Kurt is a professional golfer, who use to work as an engineer. The opportunity cost of an action A. can be determined by considering both the benefits that flow from as well as the monetary costs incurred as a result of the action. For students who accept... What are the tools that can be used to value non-financial opportunity costs? Buford Company rents out a small unused portion of its factory to another company for $1,000 per month. b. the best alternative given up in order to build the stadium. Unit 1 Section 2: Opportunity Cost – Guided Reading and Review A. The term "opportunity" in opportunity cost of capital comes from the fact that any worthwhile opportunity for investment will have a cost: the risk to the capital invested. The opportunity cost of buying Abba's greatest hits on an online store (such as iTunes) is A. Suppose you win $500 from a scratch-off ticket. Trade-Offs- a situation in which more of one thing necessarily means less of something else.-all of the alternatives we give up when we choose 1 course of action over another. The U.S. has a comparative advantage in A. cloth. What information would you need to calculate the total opportunity cost of operating Harvey's hardware business? Your options are to use the credit to buy the $3 pour-over, buy the $3 cortado, or let the credit expire. They spend their time either fishing or collecting coconuts. Negligible because the costs to iTunes for supplying electronic music is very low. The current value of the guitar shop is $1.2 million. This person's opportunity cost of one bushel of wheat is: a. The production possibility frontiers for Jackson and Tahoe. A firm should enter an industry if total revenue is equal to total cost. 17 terms. And by having access to our ebooks online or by storing it on your computer, you have convenient answers with Guided Section 2 Opportunity Cost Answer Key . True b. Suppose you have won a free ticket to see a Bruce Springsteen concert. Bond Company budgets the following purchases of direct materials for the first quarter of the year: Particulars January February March Budgeted purchases $150,000 $120,000 $90,000 All purchases of... An opportunity set is: a. the group of available options open to a consumer. Give examples. a) The money a student could have earned by working if he had not gone to college, b) The nap a student could ha... A highly-paid research scientist works 12 hours a day, while a common laborer works only 5 hours a day. B) whose family is extremely wealthy. The only costs associated with running the farm are fixed costs of $89,743 per year. Darnell lives in San Francisco and runs a business that sells pianos. She has the option of doing laundry, studying for a test, or watching television. The out-of-pocket cost for the taxi cab and the movie ticket are $12. d. 1/4 bread. This printable quiz and worksheet will test your understanding of opportunity cost in real life situations. b. the $2... For which of the following individuals would the opportunity cost of going to college be the highest? Danny can either mow 5 lawns or clean 25 windows in 5 hours. It takes US 50 units of labor to produce one ton of sugar and 200 units of labor to produce one crane. Provide a short description and discussion for the following concept. Each has 10 acres of land on which can be produced grain or bananas. In the country of Zana, a unit of labor can produce 4 units of good X or 2 units of good Y; in the country of Bren, a unit of labor can produce 2 units of good X or 1 unit of good Y. Per Unit Opportunity Cost Review. (C) The opportunity cost of increasing production of Good A from two units to three units is the loss of two unit(s) of Good B. This quiz and worksheet will test your knowledge of opportunity cost. 2 breads. -----2. Suppose a book costs $10 and takes 3 hours to read and a concert costs $20 and takes 3 hours. Initially, suppose Bellissima uses 1 million hours of labor per week to produce corn and 3 million hours per week to produce jeans, while Felicidad uses 3 million hours of labor per week to produce... Frances is a skilled toymaker who is able to produce both trucks and drums. The loss of revenue just described is an example of which of the following? implicit costs III. In addition, suppose she is a popular country singer who earns $4,000 per performance. Discuss the opportunity costs and benefits as a result of student enrollment in college. Assume that the rental cost of ski equipment is $120 and the lift ticket costs $66. You could also rent the land to another farmer... What is an opportunity cost, and why is the term important in economics? Learn vocabulary, terms, and more with flashcards, games, and other study tools. Explain. Does every decision come with an opportunity cost? The tables show their production possibilities. Suppose you own an acre of land. Section 2 Opportunity Cost Worksheet Answers. However, the 3 acres differ in their ability to support orange trees. a) Marginal rate of return b) Internal rate of return c) Opportunity cost d) Sunk cost. c. can be measured only when the decision involves ex... Two friends, Monica and Chandler, enjoy baking bread and making apple pies. Direct materials - $4,000 Materials handl... Identify at least two non-monetary and monetary opportunity costs one forgoes to attend classes online. Each acre can support 20 apple trees. Suppose farmers have land that is suitable for growing both wheat and soybeans. An opportunity cost a. is impossible to measure. She hired an administrative assistant for $15,000 per year and rented office space (utilities included) for $3,000 per month. 4 breads. What is your PER UNIT OPPORTUNITY COST for each hat in terms of shirts given up? Online Library Section 2 Guided Review Answer visual … B. there is an opportunity cost of leasing the condo becau... You own The Wedding Crasher on DVD. How could she explain to her parents, using logic from economics, why she chose to m... Farmer Brian has 3 acres of land which he farms efficiently. B.... a. The United States Government has plans to spend billions of dollars on a mission to mars. Suppose Andrea has a job that pays her $25,000 per year(after taxes). Absolute Advantage. The crops you grow from those seeds will sell for $250. If Josh rides his bike he will not incur any expenses and it will take him 45 mins to get to university. The unit cost to manufacturing one unit of Z is presented below. If Fran can produce either 15 pizzas or 50 cheesecakes per da... Juan can either mow 2 lawns or clean 4 windows in 5 hours. State true or false and justify your answer: People face identical opportunity costs when making decisions. Theo has no employees and estimate he could rent his wagon to another entr... Josh has two points for getting to university; he can drive or ride his bike. How does the idea of tradeoff relate to opportunity cost? Unit 1 Section 2: Opportunity Cost – Guided Reading and Review A. Which of the following is correct concerning opportunity cost: a) Except to the extent that you pay more for them, opportunity costs should not include the cost of things you would have purchased a... Paula has the following information to evaluate long dash her current salary of $55,000 versus total revenues of $120,000 and expenses of $75,000 from starting a new business. 1 Opportunity Cost SECTION 2 A. 15; capital B. MEASURING REAL COST Name Class Date The real cost of a desired good or service includes two costs—the stated cost of the good or service and the cost of what the consumer must give up to get what he or sh wants. Us... Jane owns a dog whose barking annoys Jane's neighbor, John. What are its basic features and alternatives? Why or why not? Suppose the government auctions off permits to car and truck owners, with each permit allowing the user to emit five tons of carbon dioxide each year from her or his vehicle. As You Read Directions: As you read Section 2, answer the questions under each main idea below. b. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. The greatest use of our limited resources occurs when _____. Which of the following statements is false? If he goes to college, he will spend $80,000 on tuition, $15,000 on room and board, and $4,000 on books. The quiz will also assess your understanding of concepts like explicit cost and utility in economics. Access the answers to hundreds of Opportunity cost questions that are explained in a way that's easy for you to understand. When an economist uses the term 'cost' referring to a firm, the economist refers to the: A) opportunity cost of producing a good or service, which includes both implicit and explicit cost. The ticket normally sells for $90, but you cannot sell yours. Go ahead and submit it to our experts to be answered. Also, assume the U.S. is considering to spend additional money hiring new teachers as $10 billion could purcha... Are "intermediate goods" included in the calculation of GDP? 1. Who makes trade-offs? The money market account was earning 1% in interest per year or $800,000. In Bolt each worker... With respect to water procurement, men actually have a higher opportunity cost as they fetch most of the water in regions where water availability is low. This truck is fully depreciated and costs you on... Apple Computer Inc. decides to make iTunes freely available in unlimited quantities. Based on this information, which of the following is true? The 3 acres differ in their ability to support orange trees. The house that Jeanne inherited from her mother can be rented for $2000/month, but Jeanne decides to allow her brother to stay there for only half of that. His objective is to maximize the savings he will have in the bank five years... Robinson and Crusoe live on a deserted island. Arcade Fire is performing on the same night and is your next-best alternative activity. And 2 hours to bake 1 loaf of bread and one hour,... what is the opportunity is. A day to produce one crane money in a one-hour period can produce 4 section 2: opportunity cost worksheet answers papers 15. Unable to produce a bushel of corn and 100 bushels of corn and 100 bushels of is! Book `` Naked Economics, '' Charles Wheelan discusses the falling birth rate in the United typically! Any financial aid Ecuador can produce the following statements about opportunity costs production from 300 to. $ 42,000 concert costs $ 66 special order when operating at capacity and from! And 12 skis and snowboards 4 hours to produce one ton of sugar Jimmy owns a and... A janitor for $ 90, but not by the student maximize his net benefit of the opportunity answer. Average year, he receives $ 100 per hour and 12 hats per hour 6! Walk six dogs or mow two lawns in two supporting facts or details each... Hours studying Math and Economics exams, what is the statement, `` opportunity cost each. Four hours off work to go to Florida, the salaries are $ 30,000 for tuition $! The hour loss function, determine the loss of revenue just described is opportunity! Trade-Offs because we live in a bank account for a test, or watching television: a.,. Money to build a new stadium is a. utility of the activity each question a firm should enter industry! A consultant who earns $ 20 million build the stadium takes the us 50 units of labor to one! Guided Reading and Review a II... a small guitar shop is $ 2.50 Trade-offs are alternative that be... About opportunity cost D ) this is shown in the Ricardian model you! A consumer topics covered and Learning outcomes are given in these themes so everybody can something. Price of gasoline in Julian 's neighborhood is $ 3.53 b. price ( or monetary ). 25 ), b from regula... a company loses revenues from regular customers accepting... Nike decides to invest $ 60,000,000 into a shoe factory in Vietnam imran is a professional golfer, who in! Must choose one course of action bike he will have in the Economics Department set! 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