Question

Kyoko and Jacques need to decide which one of them will take time off from work to complete the rather urgent task of changing the brakes on their car. Kyoko is pretty good at car repairs; she can change the brakes in 30 minutes. Jacques is somewhat slow; it takes him 5 hours to change the brakes. Kyoko earns $160 per hour as a lawyer, while Jacques earns $20 per hour as a barber. Keeping in mind that either Kyoko or Jacques must take time off from work to change the brakes, who has the lowest opportunity cost of completing the task?

Answer 1

Answer:

Kyoko

Explanation:

Based on the information provided it can be said that in this scenario the individual with the lowest opportunity cost of completing the task is Kyoko. This is because opportunity cost refers to what is being lost when choosing one opportunity or decision as opposed to another, and in this scenario since Kyoko is way faster at changing the brakes than Jacques then he will be losing less money by changing the brakes than Kyoko.

Kyoko: 160/2 = $80 opportunity cost for changing the brakes.

Jacques: 20*5 = $100 opportunity cost for changing the brakes.