Question 9 • (Galli)WCA 2221 Civics/Economics 1st nine weeks 26-27
Ricardo works part time at a local computer store. One day, his manager approaches him about moving from cashier to floor supervisor. Ricardo is excited because the promotion comes with a raise; however, the extra work hours would take away from time with his friends and family. In the end, he decides to take the promotion.What is Ricardo’s opportunity cost?
Answer
A
losing extra time to spend with his friends and family
B
being able to use the extra money for summer football camp
C
losing the ability to spend any time with his family
D
receiving another promotion in six months
Explanation
Opportunity cost is the value of the next-best option given up when making a choice. By taking the promotion, Ricardo gives up some of the time he could have spent with friends and family. The opportunity cost is losing that extra free time, not losing all family time or the possible benefits of the raise.
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