56. You paid $35 for a ticket (which is non-refundable) to see SPAM, a local rock band, in concert on Saturday. (Assume that you would not have been willing to pay any more than $35 for this concert.) Your boss called and she is looking for someone to cover a shift on Saturday at the same time as the concert. You will have to work 4 hours and she will pay you time and a half, which is $9/hr. Should you go to the concert instead of working Saturday? Concert benefit is $35; foregone wages are 4 times $9, or $36. You should work. Alternatively, the opportunity cost of working is $35, the wages you would earn are $36. Analytic Blooms: Analyze Difficulty: 3 Hard Learning Objective: 01-03 Discuss three important pitfalls that occur when applying the Cost-Benefit Principle inconsistently. Topic: Three Important Decision Pitfalls
56. You paid $35 for a ticket (which is non-refundable) to see SPAM, a local rock band, in concert on Saturday. (Assume that you would not have been willing to pay any more than $35 for this concert.) Your boss called and she is looking for someone to cover a shift on Saturday at the same time as the concert. You will have to work 4 hours and she will pay you time and a half, which is $9/hr. Should you go to the concert instead of working Saturday? Concert benefit is $35; foregone wages are 4 times $9, or $36. You should work. Alternatively, the opportunity cost of working is $35, the wages you would earn are $36. Analytic Blooms: Analyze Difficulty: 3 Hard Learning Objective: 01-03 Discuss three important pitfalls that occur when applying the Cost-Benefit Principle inconsistently. Topic: Three Important Decision Pitfalls
Sample-3.docx