📚 Learning Guide
Opportunity Cost Analysis
medium

Maria has a choice between spending her weekend working on a project that will earn her $200 or attending a concert that costs $100. If she chooses to go to the concert, what is her opportunity cost?

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Learning Path

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Choose the Best Answer

A

$200, the money she would have earned

B

$100, the cost of the concert

C

$300, the total of both opportunities

D

$0, since she enjoys the concert more

Understanding the Answer

Let's break down why this is correct

Answer

Opportunity cost is the value of what you give up when you make a choice. In Maria's case, if she decides to go to the concert, she will miss out on earning $200 from the project. The concert costs $100, so while she spends that money, the real cost of her choice is the $200 she could have earned. Therefore, her opportunity cost is $200, which is the income she forgoes by not working on the project. This helps us understand the true cost of our decisions, not just the money spent but also the benefits we miss out on.

Detailed Explanation

Opportunity cost is what you give up when you make a choice. Other options are incorrect because This answer confuses cost with opportunity cost; This answer adds both amounts together.

Key Concepts

Opportunity Cost
Trade-offs
Resource Allocation
Topic

Opportunity Cost Analysis

Difficulty

medium level question

Cognitive Level

understand

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