Question

Every society faces​ trade-offs because we live in a world of scarcity. Suppose a​ student-athlete has the opportunity to earn ​$1 comma 000 comma 0001,000,000 next year playing for a minor league baseball​ team, ​$500 comma 000500,000 next year playing for a european professional football​ team, or​ $0 returning to college for another year.

Answer 1

The earnings will generally be at $ 1 000 000.

Step-by-step explanation:

A student, while playing for the league, will be earning the amount of $ 1 000 000. In addition, the European conditions will subject him to $ 500 000. In the third year, the student will not have earnings anymore. To make the most profit, the student needs to play professional baseball for the tune of $ 100 000.

Answer 2

Answer: Opportunity cost of returning to college next year is $1,000,000.

Explanation: Opportunity cost is the cost of the next best alternative sacrificed or foregone. When the athlete chooses to join college he is sacrificing his income that could be earned from playing the game. The player has the option of playing for the minor league baseball team for $1,000,000 or for European professional football team for ​$500,000. The person thus has a choice between playing for the minor league baseball team (since it is the highest paying) or going to college. Thus the opportunity cost of going to college will be $1,000,000.