Question

For most young people, working full-time and going to school are substitutes: You tend to do one or the other. When it’s tough to find a job, does that raise the opportunity cost of going to college or does it lower it? When it’s tough to find a job, does the demand for college rise or fall?

Answer 1

Answer:

The answers are:

• It lowers the opportunity cost of going to college
• The demand for college rises.

Explanation:

The opportunity cost can be defined as what you lose because when decide to choose a different alternative.

In this case going to college means losing the possible revenue (salary) you can get by working. If you can´t find a job, then your possible (salary) decreases, so the cost of opportunity of going to college lowers. Therefore the demand for attending college increases.