Arlene quits her $125 000-a-year job to take care of her ailing parents.What is the opportunity cost of her decision?

Question

Quizplus · Accepted Answer

Opportunity cost is the value of the next best alternative forgone. In this scenario, Arlene is giving up her $125,000 job to take care of her parents, so the opportunity cost is at least $125,000 because that is the salary she could have earned if she continued working. It is important to note that the opportunity cost in this case does not take into account any emotional or personal value that Arlene may place on taking care of her parents, as that is subjective and cannot be quantified.

Arlene Quits Her $125 000-A-Year Job to Take Care of Her