Question

Debbie quits her job, which pays $30,000 a year, to finish her college degree. Her annual college expenses are $10,000 for tuition, $2,000 for books, and $700 for food. What is her opportunity cost of attending college for the year?

Answer 1

Debbie's opportunity cost of attending college for the year is $42,000.

Explanation:

Debbie quits her job, which pays $30,000 a year, to finish her college degree.

Her annual college expenses are $10,000 for tuition, $2,000 for books, and $700 for food.

So, her opportunity cost will include the amount of salary she could have earned if she continued working plus the cost of tuition plus the cost of books:

`30000+10000+2000=42000` dollars

Therefore, Debbie's opportunity cost of attending college for the year is $42,000.