Suppose Your Expenses for This Term Are as Follows: Tuition

question 262

Multiple Choice

Suppose your expenses for this term are as follows: tuition: $5,000, room and board: $3,000, books and other educational supplies: $500.Further, during the term, you can only work part-time and earn $12,000 instead of your full-time salary of $20,000.What is the opportunity cost of going to university this term, assuming that your room and board expenses would be the same even if you did not go to university?

• A)$5,500
• B)$8,500
• C)$13,500
• D)$20,500

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Definitions:

Return on Assets

A financial ratio that indicates how profitable a company is relative to its total assets.

Net Income

The profit a company makes post all deductions of expenses and taxes from its overall revenue.

Assets

Assets held by a company or person anticipated to yield benefits in the future.

U.S. Treasury Bonds

Long-term government securities issued by the U.S. Department of the Treasury with a fixed interest rate and maturity of more than 10 years.