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Carl is considering attending a concert with a ticket price of $35. He estimates that the cost of driving to the concert and parking there will total an additional $20. In order to attend the concert, Carl will have to take time off from his part-time job or forgo studying for an exam scheduled for the next morning. He estimates that he will lose 5 hours of work, at a wage of $6 per hour or 5 hours of study time. If Carl considers studying the best alternative use of his time, his opportunity cost of attending the concert equals

Answer :

abiolataiwo2015

Assuming Carl considers studying the best alternative use of his time, his opportunity cost of attending the concert equals will be $85

First step

Loss of money income= 5 hours × $6 per hour

Loss of money income= $30

Second step.

Expenses for attending the concert= $35 + $20

Expenses for attending the concert= $55

Now let determine the opportunity cost of attending the concert

Opportunity cost=$30+$55

Opportunity cost = $85

Inconclusion Assuming Carl considers studying the best alternative use of his time, his opportunity cost of attending the concert equals will be $85

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