Suppose a US "World of Warcraft" player's opportunity cost is $8.00 an hour and can collect 25 coins per hour playing in the game. If the player wants to use a shortcut, it would be worthwhile for him to buy virtual coins if the price is:

Question

Quizplus · Accepted Answer

The opportunity cost of the player is $8.00 per hour, which means that if he spends one hour playing World of Warcraft, he is giving up the opportunity to earn $8.00 doing something else.

The player can collect 25 coins per hour playing in the game. Therefore, if he were to spend an hour playing and collecting coins, his earnings would be:

25 coins/hour x $0.00/coin = $0.00/hour

However, if the player were to buy coins instead, he would have to pay a certain amount for each coin. Let's call this amount "x".

If the player were to spend an hour working and earning money instead of playing, he could earn $8.00. Therefore, for it to be worthwhile for him to buy coins, he should spend less than $8.00 to buy enough coins to equal the amount he would have earned by working.

The number of coins he would need to buy is:

25 coins/hour x $8.00/hour = 200 coins

Therefore, for it to be worthwhile for him to buy coins, he should spend less than:

200 coins x $x/coin

Solving for x, we get:

x < $0.04/coin

Therefore, for it to be worthwhile for the player to buy coins, the price should be less than $0.04/coin.

Option B is the only answer that meets this requirement (less than $0.32 or 32 cents/coin).

Suppose a US "World of Warcraft" Player's Opportunity Cost Is