Question

Kate enjoys horseback riding and has been wanting a new show saddle for her

horse. She has been saving her baby-sitting money for a year and finally has the
$680. Prior to making the purchase, Kate's dad congratulates her on meeting her
savings goal. He also reminds her to really consider the opportunity cost of her
decision. Kate is confused about what her dad means by this. How would you
explain opportunity cost to Kate?

Answer 1

I would explain to her that she should think about what she could actually do with the money.

Step-by-step explanation:

I would tell kate she should really consider how she should spend her money and what she should actually spend it on. If she actually wants the horse saddle she should buy it, but she should think about what she actually might want or need later.

Answer 2

He is very happy his daughter can reach her goal but he wants to make sure she is definitely sure on what she wants to spend the money on