Question

Which of the following should not be considered as an opportunity cost of attending college?

(A) money spent on living expenses that are the same wether or not you attend the college
(B) lost salaries
(C) Business lunches
(D) Interest that could have been earned on your money had you put the money into a saving account instead of spending it on tuition
(E) opportunities sacrificed in the decision to attend college.

Answer 1

Answer:

Option (A) is correct.

Explanation:

Opportunity cost refers to the cost that is incurred by selecting some other alternative. It is the benefit that is foregone from the next best alternative.

Therefore, the opportunity of attending college is as follows:

(a) Salary amount that could have been earned from the job.

(b) Interest income from depositing money into savings account

(c) The satisfaction obtained from the business lunches.

(d) Opportunities that were sacrificed for attending college.