Opportunity Cost Answers

One method for studying opportunity cost is to think in terms of

Rescooperate Ice Cream Shop recently analyzed their books. They found that in the past year, they made $100,000 selling ice cream and spent $75,000 on supplies and factory space. The remaining $25,000 represents

On a production possibility curve, data points that fall outside of the curve represent

Look at the equation framework.

Producers can create their maximum combination of goods, as long as they

production possibility curveproduction supply curveproduction opportunity curve

opportunity costsrevenueprofitresource costs

Read the scenario. Samira is a freshman basketball player who hopes to go to college on a basketball scholarship. She is offered the chance to play on her school’s varsity basketball team, which plays in tournaments during holiday breaks. Samira usually spends her breaks working at the local hardware store. After careful consideration, Samira decides to stay on the freshman basketball team and keep working over breaks. The fact that Samira may miss out on a scholarship opportunity by staying on the freshman team illustrates

Venya and Kari own a flower shop that specializes in custom bouquets. Wanting to expand into selling potted plants, they create a production possibility chart to assess whether the potted plants are a good idea. Study their chart:

Demonstrating opportunity cost is done through production