Samantha's college raises the cost of room and board per semester.This increase raises Samantha's opportunity cost of attending college

Question

Quizplus · Accepted Answer

The opportunity cost of attending college is the value of the next best alternative that must be given up to attend college. If the cost of attending college increases, but the cost of not attending college stays the same, then the opportunity cost of attending college has increased. This means that Samantha has to give up more in order to attend college, which reduces her incentive to do so. However, if the cost of not attending college increases by the same amount or more than the cost of attending college, then the opportunity cost of attending college has not increased as much or may have even decreased. In this case, Samantha's incentive to attend college may not be affected or may even increase. Therefore, the correct answer is C, only if the amount she would have to pay for room and board if she didn't attend college rose by less than the increase in the amount her college charges.

Samantha's College Raises the Cost of Room and Board Per