Russell Spends an Hour Studying Instead of Playing Tennis

question 229

Multiple Choice

Russell spends an hour studying instead of playing tennis.The opportunity cost to him of studying is

• A) the improvement in his grades from studying for the hour.
• B) the improvement in his grades from studying minus the enjoyment of playing tennis.
• C) the enjoyment and exercise he would have received had he played tennis.
• D) zero.Since Russell chose to study rather than to play tennis,the value of studying must have been greater than the value of playing tennis.

---

Definitions:

Revealed Preference

An economic concept suggesting that the preferences of consumers can be observed by their purchasing habits and choices.

Inflation Level

Inflation level measures the rate at which the general level of prices for goods and services is rising, eroding purchasing power.

Base Year

A specific year chosen as a point of reference or benchmark for financial or economic data comparison over time.

Laspeyres Index

A measure of price inflation that calculates the relative price change of a fixed basket of goods and services at current prices compared to the prices of the same basket in a base period.