Suppose that adding a new disc drive to your computer increases its value by $100.The disc drive costs $75 and takes you 2 hours to install.If you value your time at $6 per hour then the net benefit of installing the disc drive is:
A) $13.
B) $19.
C) $25.
D) $88.

Question

Quizplus · Accepted Answer

The net benefit is the increase in value minus the cost of the drive and the cost of installation. The increase in value is $100, the cost of the drive is $75, and the cost of installation is 2 hours x $6 per hour = $12. Therefore, the net benefit is $100 - $75 - $12 = $13.

Suppose That Adding a New Disc Drive to Your Computer