Suppose That Rosa Is Considering Migration to Another Country

question 253

Multiple Choice

Suppose that Rosa is considering migration to another country. To move, she will have to spend $2,000 on transportation and $5,000 in application and other processing fees. Rosa's stream of future earnings in her home country is $300,000. She expects to earn a stream of future earnings of $700,000 in another country. Based on this information, Rosa's implicit cost of migrating is

• A)$7,000.
• B)$300,000.
• C)$307,000.
• D)$400,000.

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Definitions:

Marginal Social Cost

The comprehensive expense encountered by society to produce one more unit of a good or service, encompassing private expenses as well as any extraneous costs.

Efficient Level

The optimal point at which a particular activity achieves the best output or outcome with the least waste of resources or effort.

Marginal Social Cost

The total cost to society of producing an additional unit of a good, including both private costs and any externalities.

External Cost

Costs of a transaction that affect people other than the buyer or seller, often not included in the price of goods or services.