Going skiing will cost Adam $80 a day. He also loses $40 per day in wages because he has to take time off from work. Adam still decides to go skiing.
A)Adam's lost $40 per day in wages is not an opportunity cost and so did not affect his decision.
B)He loses a total of $120 per day, so his decision is irrational.
C)The $80 price of skiing is not an opportunity cost and so did not affect Adam's decision.
D)His decision is rational if Adam's marginal benefit of spending a day skiing is greater than his marginal cost.
E)Adam is definitely making a decision that is in the social interest.

Question

Quizplus · Accepted Answer

Adam's decision is rational if the marginal benefit he receives from skiing exceeds the marginal cost, which includes both the $80 cost and the $40 in lost wages, totaling $120 per day.

Going Skiing Will Cost Adam $80 a Day