Mary is considering leaving her current position to open an ice cream shop.Mary's current annual salary is $77,000.Annual ice cream shop revenue and costs are estimated at $260,000 and $210,000,respectively.What is Mary's annual opportunity cost of remaining employed in her current position?
A)$50,000
B)$77,000
C)$210,000
D)$260,000

Question

Quizplus · Accepted Answer

Mary's annual opportunity cost is the amount she would have earned if she opened an ice cream shop minus her current annual salary.

So, her annual opportunity cost would be:

$260,000 - $210,000 - $77,000 = $50,000

Therefore, the best choice is A) $50,000.

Mary Is Considering Leaving Her Current Position to Open an Ice