Suppose that the alternative uses of an hour of your time in the evening, ranked from best to worst, are (1) study economics, (2i) watch two half-hour TV sitcoms, (3) play pool, and (4) jog around town. You can only choose one activity. What is the opportunity cost of studying economics for one hour, given this information?

Question

Quizplus · Accepted Answer

The opportunity cost of studying economics for one hour is the value of the best alternative foregone, which in this case is watching two half-hour TV sitcoms. The opportunity cost of playing pool and jogging around town are ranked lower and therefore not the best alternative foregone. The sum of watching TV sitcoms, playing pool, and doing laundry is not relevant to the decision-making process as they are not ranked in order of preference. Therefore, the best choice is B which is to watch two half-hour TV sitcoms.

Suppose That the Alternative Uses of an Hour of Your