Suppose Your Expenses for This Term Are as Follows: Tuition

question 69

Multiple Choice

Suppose your expenses for this term are as follows: tuition: $12,000, room and board: $6,500, books and other educational supplies: $1,500.Further, during the term, you can only work part-time and earn $3,500 instead of your full-time salary of $14,000.What is the opportunity cost of going to college this term, assuming that your room and board expenses would be the same even if you did not go to college?

• A)$13,500
• B)$20,000
• C)$24,000
• D)$30,500

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Definitions:

Lump-Sum Tax

A tax of a fixed amount that does not vary with the taxpayer's income or activities.

Marginal Tax Rate

The tax rate that applies to the next dollar of taxable income, indicating how much of any additional income will be taken in taxes.

Sales Tax

A consumption tax imposed by the government on the sale of goods and services.

Structural

Relating to the underlying or foundational aspects or structures of a system, organization, or building.