Jen spends her afternoon at the beach, paying $1 to rent a beach umbrella and $11 for food and drinks rather than spending an equal amount of money to go to a movie. Her opportunity cost of going to the beach is:

Question

Quizplus · Accepted Answer

Opportunity cost is the value that must be foregone to undertake an activity. By going to the beach, Jen gives up the value she places on seeing the movie. We don't include the $12 she spends at the beach because she also would have spent that money at the movies.

Jen Spends Her Afternoon at the Beach, Paying $1 to Rent