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frutty [35]
2 years ago
14

Juanita makes $30 an hour at work. She has to take time off work to purchase her suit, so each hour away from work costs her $30

in lost income. Assume that returning to work takes Juanita the same amount of time as getting to a store and that it takes her 30 minutes to shop. As you answer the following questions, ignore the cost of gasoline and depreciation of her car when traveling.
Assume that it takes 15 minutes to travel to the local department store, 30 minutes to travel to the store across town, and 60 minutes to travel to the store in the neighboring city.

Complete the following table by computing the opportunity cost of Juanita's time and the total cost of shopping at each location.

Store Opportunity Cost of Time (Dollars) Price of a Suit (Dollars per suit) Total Cost (Dollars)
Local Department Store ___________________ 114 _________
Across Town ___________________ 86 _________
Neighboring City ____________________ 60 _________
Business
1 answer:
vazorg [7]2 years ago
5 0

Answer:

Across Town

Explanation:

Missing word <em>"Assume that Juanita takes opportunity costs and the price of the suit into considerate when she shops. Juanita will minimize the cost of the suit if she buys it from the </em><em><u>               </u></em><em>"</em>

<em />

<u>Local Department Store</u>

15 min + 15 min + 30 min = 1 hour

Opportunity cost of time = 1 hour * $30 = $30

Total cost = $30 + $114 = $144

<u>Across Town</u>

30 min + 30 min + 30 min = 1.5 hours

Opportunity cost of time = 1.5 hours*$30 = $45

Total cost = $45 + $66 = $131

<u>Neighboring City</u>

6 min + 60 min + 30 min = 2.5 hours

Opportunity cost of time = 2.5 hours*$30 = $75

Total cost = $75 + $60 = $135

Assume that Juanita takes opportunity costs and the price of the suit into considerate when she shops. Juanita will minimize the cost of the suit if she buys it from the <u>Across Town</u>.

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