The calculation of the opportunity cost .

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 10, Problem 1SPA

To determine

The calculation of the opportunity cost.

Expert Solution & Answer

Explanation of Solution

The opportunity cost of a firm includes the cost of the resources owned by the firm, the cost of resources supplied by the firm’s owner, and the cost of using the resources bought in the market.

The opportunity cost of JJVB includes the following as mentioned in table 1:

Table 1

Particulars	Cost (in $)
Wages paid	20,000
Interest forgone on $50,000 which could be used to pay for mortgage loan	3,000 (50,000×6100)
Income forgone	30,000
Leisure forgone	15,000 (30×500)
Depreciation cost of equipment	2,000 (30,000−28,000)
Goods and services bought from other firms	10,000
Total opportunity cost	80,000

The total opportunity cost of JJVB is $80,000.

Economics Concept Introduction

Opportunity cost: The opportunity cost is the cost of the foregone alternative, that is, the loss of other alternative when one alternative is chosen.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Sam's profit is maximized when he produces shirts. When he does this, the marginal cost of the last shirt he produces is , which is than the price Sam receives for each shirt he sells. The marginal cost of producing an additional shirt (that is, one more shirt than would maximize his profit) is , which is than the price Sam receives for each shirt he sells. Therefore, Sam's profit-maximizing quantity corresponds to the intersection of the curves. Because Sam is a price taker, this last condition can also be written as .

Why must total spending be equal to total income in an economy? Total income plus total spending equals total output. The value-added measurement of GDP shows this is true. Every dollar that someone spends is a dollar of income for someone else. all of the above

Labor Market Data Price $5 $10 $15 $20 $25 3,000,000 6,000,000 9,000,000 12,000,000 15,000,000 Qd 15,000,000 12,000,000 9,000,000 6,000,000 3,000,000 Price $30 $25 $20 $15 $10 $5 + +- x- 3 6 Do + + F 9 12 15 Quantity (In millions) Area of a triangle = 1/2* base *height Market Efficiency & Total Surplus Worth Publishers SCENARIO: The state government is considering raising the minimum wage from $15 per hour to $20 per hour over the next 3 years. As an economic advisor to the governor, you have been asked to provide a recommendation on whether the minimum wage should be increased based on economic theory. Consider the labor market data provided. Prepare a brief report that: 1. Explains whether the labor market is currently efficient at the equilibrium wage of $15 per hour. How would you know? At equilibrium, what (dollar amount) is the Total Surplus this market provides? Show your rationale with numbers. 2. Analyzes the impact on total surplus in the market if the minimum wage is raised…

Answer 2

Question

Chapter 10, Problem 1SPA

To determine

The calculation of the opportunity cost.

Expert Solution & Answer

Explanation of Solution

The opportunity cost of a firm includes the cost of the resources owned by the firm, the cost of resources supplied by the firm’s owner, and the cost of using the resources bought in the market.

The opportunity cost of JJVB includes the following as mentioned in table 1:

Table 1

Particulars	Cost (in $)
Wages paid	20,000
Interest forgone on $50,000 which could be used to pay for mortgage loan	3,000 (50,000×6100)
Income forgone	30,000
Leisure forgone	15,000 (30×500)
Depreciation cost of equipment	2,000 (30,000−28,000)
Goods and services bought from other firms	10,000
Total opportunity cost	80,000

The total opportunity cost of JJVB is $80,000.

Economics Concept Introduction

Opportunity cost: The opportunity cost is the cost of the foregone alternative, that is, the loss of other alternative when one alternative is chosen.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 10, Problem 1SPA

To determine

The calculation of the opportunity cost.

Expert Solution & Answer

Explanation of Solution

The opportunity cost of a firm includes the cost of the resources owned by the firm, the cost of resources supplied by the firm’s owner, and the cost of using the resources bought in the market.

The opportunity cost of JJVB includes the following as mentioned in table 1:

Table 1

Particulars	Cost (in $)
Wages paid	20,000
Interest forgone on $50,000 which could be used to pay for mortgage loan	3,000 (50,000×6100)
Income forgone	30,000
Leisure forgone	15,000 (30×500)
Depreciation cost of equipment	2,000 (30,000−28,000)
Goods and services bought from other firms	10,000
Total opportunity cost	80,000

The total opportunity cost of JJVB is $80,000.

Economics Concept Introduction

Opportunity cost: The opportunity cost is the cost of the foregone alternative, that is, the loss of other alternative when one alternative is chosen.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 10, Problem 1SPA

To determine

The calculation of the opportunity cost.

Expert Solution & Answer

Explanation of Solution

The opportunity cost of a firm includes the cost of the resources owned by the firm, the cost of resources supplied by the firm’s owner, and the cost of using the resources bought in the market.

The opportunity cost of JJVB includes the following as mentioned in table 1:

Table 1

Particulars	Cost (in $)
Wages paid	20,000
Interest forgone on $50,000 which could be used to pay for mortgage loan	3,000 (50,000×6100)
Income forgone	30,000
Leisure forgone	15,000 (30×500)
Depreciation cost of equipment	2,000 (30,000−28,000)
Goods and services bought from other firms	10,000
Total opportunity cost	80,000

The total opportunity cost of JJVB is $80,000.

Economics Concept Introduction

Opportunity cost: The opportunity cost is the cost of the foregone alternative, that is, the loss of other alternative when one alternative is chosen.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 10, Problem 1SPA

To determine

The calculation of the opportunity cost.

Expert Solution & Answer

Explanation of Solution

The opportunity cost of a firm includes the cost of the resources owned by the firm, the cost of resources supplied by the firm’s owner, and the cost of using the resources bought in the market.

The opportunity cost of JJVB includes the following as mentioned in table 1:

Table 1

Particulars	Cost (in $)
Wages paid	20,000
Interest forgone on $50,000 which could be used to pay for mortgage loan	3,000 (50,000×6100)
Income forgone	30,000
Leisure forgone	15,000 (30×500)
Depreciation cost of equipment	2,000 (30,000−28,000)
Goods and services bought from other firms	10,000
Total opportunity cost	80,000

The total opportunity cost of JJVB is $80,000.

Economics Concept Introduction

Opportunity cost: The opportunity cost is the cost of the foregone alternative, that is, the loss of other alternative when one alternative is chosen.

Answer 6

Chapter 10, Problem 1SPA

To determine

The calculation of the opportunity cost.

Expert Solution & Answer

Explanation of Solution

The opportunity cost of a firm includes the cost of the resources owned by the firm, the cost of resources supplied by the firm’s owner, and the cost of using the resources bought in the market.

The opportunity cost of JJVB includes the following as mentioned in table 1:

Table 1

Particulars	Cost (in $)
Wages paid	20,000
Interest forgone on $50,000 which could be used to pay for mortgage loan	3,000 (50,000×6100)
Income forgone	30,000
Leisure forgone	15,000 (30×500)
Depreciation cost of equipment	2,000 (30,000−28,000)
Goods and services bought from other firms	10,000
Total opportunity cost	80,000

The total opportunity cost of JJVB is $80,000.

Economics Concept Introduction

Opportunity cost: The opportunity cost is the cost of the foregone alternative, that is, the loss of other alternative when one alternative is chosen.

Answer 7

Chapter 10, Problem 1SPA

To determine

The calculation of the opportunity cost.

Answer 8

Expert Solution & Answer

Explanation of Solution

The opportunity cost of a firm includes the cost of the resources owned by the firm, the cost of resources supplied by the firm’s owner, and the cost of using the resources bought in the market.

The opportunity cost of JJVB includes the following as mentioned in table 1:

Table 1

Particulars	Cost (in $)
Wages paid	20,000
Interest forgone on $50,000 which could be used to pay for mortgage loan	3,000 (50,000×6100)
Income forgone	30,000
Leisure forgone	15,000 (30×500)
Depreciation cost of equipment	2,000 (30,000−28,000)
Goods and services bought from other firms	10,000
Total opportunity cost	80,000

The total opportunity cost of JJVB is $80,000.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Opportunity cost: The opportunity cost is the cost of the foregone alternative, that is, the loss of other alternative when one alternative is chosen.

Answer 12

Ch. 10.1 - Prob. 1RQ Ch. 10.1 - Prob. 2RQ Ch. 10.1 - Prob. 3RQ Ch. 10.1 - Prob. 4RQ Ch. 10.1 - Prob. 5RQ Ch. 10.2 - Prob. 1RQ Ch. 10.2 - Prob. 2RQ Ch. 10.2 - Prob. 3RQ Ch. 10.2 - Prob. 4RQ Ch. 10.3 - Prob. 1RQ

The calculation of the opportunity cost .

The calculation of the opportunity cost.

Explanation of Solution

Want to see more full solutions like this?

Chapter 10 Solutions