You decide to spend time studying for a philosophy exam, even though you have offers to go to see a movie, go out to dinner, or go to a poetry reading. This is a difficult choice for you because you really want to go to the poetry reading and would choose that over seeing the movie or going out to dinner. Your opportunity cost of spending time studying for your philosophy exam is
A) going to the movie.
B) going out to dinner.
C) going to the poetry reading.
D) all of the above, since you have offers to do all three

Question

Quizplus · Accepted Answer

The opportunity cost is the value of the next best alternative foregone. Since you would choose going to the poetry reading over the other options if you weren't studying, the poetry reading represents the highest valued alternative forgone, making it the opportunity cost.

You Decide to Spend Time Studying for a Philosophy Exam