Suppose There Are Only Three Alternatives to Attending a "Free

question 107

Multiple Choice

Suppose there are only three alternatives to attending a "free" social event: read a novel (you value this at $10) ,go to work (you could earn $20) ,or watch videos with some friends (you value this at $25) .The opportunity cost of attending the social event is

• A)$10.
• B)$20.
• C)$25.
• D)$45.
• E)$55.

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Definitions:

Neoclassical Economics

An economic theory that focuses on how individuals' rational behavior and efficient markets lead to an allocation of resources that maximizes utility and profit.

Behavioral Economics

This discipline of economics examines the role of psychological, cognitive, emotional, cultural, and social aspects in shaping the economic choices of both individuals and institutions.

Neoclassical Economics

A framework within economics that focuses on the determination of goods, outputs, and income distributions in markets through supply and demand.

Uncertainty

The state of having limited knowledge where it is impossible to exactly describe the existing state, a future outcome, or more than one possible outcome.