Going Skiing Will Cost Adam $80 a Day

question 126

Multiple Choice

Going skiing will cost Adam $80 a day.He also loses $40 per day in wages because he has to take time off from work.Adam still decides to go skiing.

• A) His decision is rational if Adam's marginal benefit of spending a day skiing is greater than his marginal cost.
• B) The $80 price of skiing is not an opportunity cost and so did not affect Adam's decision.
• C) He loses a total of $120 per day, so his decision is irrational.
• D) Adam's lost $40 per day in wages is not an opportunity cost and so did not affect his decision.
• E) Adam is definitely making a decision that is in the social interest.

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Definitions:

Capital Market

A financial market in which long-term debt or equity-backed securities are bought and sold, different from the short-term funds seen in the money market.

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price.

Output Price

The cost at which goods or services are offered for sale in the marketplace.

Graduate School

An advanced academic institution providing postgraduate education in various disciplines, leading to degrees like Master's or Doctorate.