With a budget of $500 000,a school board can choose to purchase 20 000 textbooks or 2000 laptop computers (or some intermediate combination)for use in classrooms. FIGURE 1-2 Refer to Figure 1-2.Suppose the school board chooses to allocate all $500 000 to the purchase of laptop computers.What is the opportunity cost of this entire purchase?
A)The opportunity cost is 2000 laptops.
B)The opportunity cost is 20,000 textbooks.
C)The opportunity cost is uncertain.
D)The opportunity cost is $0.
E)There is no opportunity cost because the purchase was made within the available budget.

Question

With a budget of $500 000,a school board can choose to purchase 20 000 textbooks or 2000 laptop computers (or some intermediate combination)for use in classrooms.  FIGURE 1-2 Refer to Figure 1-2.Suppose the school board chooses to allocate all $500 000 to the purchase of laptop computers.What is the opportunity cost of this entire purchase?
A)The opportunity cost is 2000 laptops. 
B)The opportunity cost is 20,000 textbooks. 
C)The opportunity cost is uncertain. 
D)The opportunity cost is $0. 
E)There is no opportunity cost because the purchase was made within the available budget.

Quizplus · Accepted Answer

The opportunity cost of choosing to purchase laptop computers is the alternative option that was not chosen, which in this case is textbooks. Therefore, the opportunity cost is 20,000 textbooks.

With a Budget of $500 000,a School Board Can Choose