Jim,a Student at Southern Province University,is Enrolled in 15 Credit

question 202

Multiple Choice

Jim,a student at Southern Province University,is enrolled in 15 credit hours this semester.He is passing Calculus,but just barely,so he is considering withdrawing from the course.He tells a friend,"I would drop the course but I don't want to waste the $500 I paid in tuition." His friend replies,"The $500 tuition you paid for the course is irrelevant to your decision.Your grade in the course is the only thing that is important now." The friend is

• A) incorrect,because the tuition will have to be paid again when Jim retakes the course.
• B) correct,because the tuition is an average cost and average costs should never be considered when making decisions.
• C) incorrect,because the tuition is a marginal cost and marginal costs should always be considered when making decisions.
• D) correct,because the tuition is a sunk cost and sunk costs should not be considered when making decisions.
• E) incorrect,and obviously so rich that money means nothing to him/her.

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Definitions:

Neolithic Period

A phase in human history marked by the development of agriculture and permanent settlements, roughly beginning around 10,000 BCE.

Domestication

The process by which humans modify the genetic traits of plants and animals to better serve human purposes.

Agriculture

The science or practice of farming, including cultivation of soil for growing crops and rearing animals to provide food, wool, and other products.

Hunting and Gathering

A traditional subsistence strategy based on the procurement of food by hunting animals and foraging for plants.