The opportunity cost is the value of the next best alternative foregone. In this case, Sara's income is $12 a week, and if she chooses to spend it on a smoothie, she could have bought four bags of popcorn (12 / 3 = 4). Therefore, the opportunity cost of a smoothie is four bags of popcorn.
Let's break down the calculations step by step:
1. Sara's Income: $12 per week.
2. Price of Popcorn: $3 per bag.
3. Calculating Popcorn Quantity: Sara can buy 4 bags of popcorn with her income because:
=
4. Opportunity Cost of a Smoothie: If Sara decides to buy a smoothie instead of popcorn, the opportunity cost is the foregone quantity of popcorn, which is 4 bags.
In conclusion, with a weekly income of $12, Sara faces a trade-off: she can either enjoy 4 bags of popcorn or opt for smoothies. The opportunity cost of choosing a smoothie is sacrificing the chance to have 4 bags of popcorn within her budget constraints.