Your neighbors have offered to pay you to look after their dog while they are on vacation. It will take you one hour per day to feed, walk, and care for the dog, which you can do either before or after you go to work. Your regular job pays $10 per hour, and you can work up to eight hours per day. The smallest amount of money you would accept to look after your neighbor's dog each day is equal to:
A)$10, because that is your opportunity cost of one hour of work.
B)$15, because overtime wages are generally 1.5 times your regular wage when you work more than eight hours a day.
C)zero, because your regular job is not available for more than eight hours per day.
D)the value you place on one hour of leisure.

Question

Quizplus · Accepted Answer

Your opportunity cost is the value of what you have given up in order to take care of the dog. Since you can look after the dog before or after work, your opportunity cost is the value you place on an hour of leisure.

Your Neighbors Have Offered to Pay You to Look After