Question

A car dealership union negotiates a contract that dramatically increases the salaries of all salesmen. If one of the salesmen is thinking of changing careers to be a hardware salesman, his opportunity cost:___________.

a. Would not be affected
b. Of becoming a hardware salesman would decrease
c. Of becoming a hardware salesman would increase
d. None of the above

Answer 1

c. Of becoming a hardware salesman would increase

Explanation:

Opportunity cost defines that when a person gets to benefit from another than he received. So, that person takes another benefit from where he gets more benefit or we can say that he will choose the best alternative.

According to the given situation, A car dealership association is negotiating a contract that significantly increases all salesmen 's wages. Now, the Opportunity cost when one of the salespersons feels that shifting the path to hardware is of becoming a hardware salesperson that would increase.

Hence, the right answer is C