Saturday afternoon you can either attend a street festival, work and earn $100, or study for your midterm exam. You flip a coin between the street festival and studying, but did not really consider working. The coin flip determined that you would stay home and study. The opportunity cost of the time spent studying includes:
A. The time you spent deciding upon using a coin flip to determine your Saturday afternoon activity.
B. earning a high score on your midterm.
C. the loss of $100 worth of wages and going to the street festival.
D. the benefit that could have been received at the street festival.
Answer: D
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Opportunity cost is
A. the financial cost of purchasing a good or services B. the marginal benefit minus the marginal cost C. the expected value of buying a good or service D. the value of the opportunity that you give up when you choose one activity instead of another one
Given the information in Scenario 4.3, it would be correct to say that demand is:
A) infinitely elastic. B) elastic, but not infinitely elastic. C) unit elastic (Ep = -1). D) inelastic, but not completely inelastic. E) completely inelastic.