Opportunity Costs

Opportunity cost is the cost we pay when we give up something to get something else.

• True

• False

If you have a job, what do you give up to go to work?

• I could sleep in.

• I could take my dog to the park and play all day.

• I could spend the day looking for a better job.

There are many benefits to a college education. So what are the costs?

• There are monetary costs.

• Spend four or more years going to classes

• You could be working and earning money instead of going to college.

• giving up free time for study time that could be used to do other things

Higher earnings is a distinct benefit of a college education.

• True

• False

Tony buys a pizza and with that same amount of money he could have bought a drink and a hot dog. The opportunity cost is the drink and hot dog.

• True

• False

David decides to quit working and go to school to get further training. The opportunity cost of this decision is the lost wages for a year.

• True

• False

Jorge really wants to eat at a new restaurant and can only afford it if he does not order a dessert. The opportunity cost is the dessert.

• True

• False

If you decide not to go to work, the opportunity cost is the lost wages.

• True

• False