In Introducing the Opportunity Cost of Time into the Theory

question 223

Multiple Choice

In introducing the opportunity cost of time into the theory of consumer behavior, we find that, all else equal,

• A) one should consume less of time-intensive goods.
• B) one should consume more of time-intensive goods.
• C) the consumer's equilibrium position is not altered.
• D) the marginal utility derived from each product must be multiplied by consumption time in determining equilibrium.

---

Definitions:

Departmental Gross Profit

The difference between sales and the cost of goods sold for a specific department, highlighting its profitability.

Revenue

An amount earned by performing services for customers or selling goods to customers; it can be in the form of cash or accounts receivable. A subdivision of owner’s equity: As revenue increases, owner’s equity increases.

Breakfast Department

A specific business unit within a hospitality organization that is responsible for managing and operating the breakfast service.

Cost Center

is a segment of a business that does not directly generate revenue but incurs costs, like a human resources department.