Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Choosing to buy a new car instead of investing the money in stocks
B
Deciding to spend your evening studying instead of going out with friends
C
Opting for a larger size of fries when purchasing a burger
D
Selecting to travel by train rather than flying to save money
Understanding the Answer
Let's break down why this is correct
Answer
Opportunity cost analysis helps us understand what we give up when we make a choice. For example, imagine you have $10 and can either buy a book or go to the movies. If you choose to buy the book, the opportunity cost is the fun you miss by not going to the movies. The concept of marginal utility comes into play because it helps you evaluate how much satisfaction you get from each option. If the joy of reading the book is greater than the enjoyment of the movie, then spending your money on the book might be the better choice for you.
Detailed Explanation
When you choose to study instead of going out, you weigh the benefits of learning against having fun. Other options are incorrect because This choice focuses on spending money, not on the immediate benefits of each option; Choosing larger fries is about size, not about choosing between two different activities.
Key Concepts
trade-offs
alternative choices
marginal utility
Topic
Opportunity Cost Analysis
Difficulty
hard level question
Cognitive Level
understand
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