Question

John loves to sleep late in the morning. He also knows that school is important. This morning, John chose to wake up and get to school on time. In doing this, he gave up the opportunity to sleep in. The opportunity cost of John's choice to go to school is two or three hours of sleep. Ana loves to go camping with her family and is looking forward to their trip next weekend. Ana learns that her good friend is having a sleepover birthday party the same Saturday as the trip. For Ana, what would be the opportunity cost of going to her friend's party? Why?

Answer 1

The opportunity cost of Ana going to her friend’s birthday party is not going on the camping trip with her family, because the “cost” of going to the party would be losing the chance to go on a camping trip with her family.

Answer 2

Answer:

For Ana, the opportunity cost of going to her friend's party would be not to camp with the family over the weekend.

Explanation:

Opportunity cost is a term used to indicate the cost of something in terms of a foregone opportunity, that is, the cost of waiver of a situation in exchange for another situation.

So, the cost of opportunity for Ana, if she goes to her friend's birthday party, is giving up the opportunity to camp with her family over the weekend. This is because the two situations happen in the same period of time, so Ana will have to renounce one of the situations.