Home worksheet -1

1.Jimmy, a consultant, earns Rs.2000 for an hour. Instead of working one might, he goes
to a match for Indian Premier League Match in New Delhi which costs him Rs.1000 and
will last at least five hours. What is the opportunity cost of watching the cricket instead of
working?

2. Ruth has a mobile hot-dog stand. She wants to employ 2 students to work for her between
June and August. She expects each employee to generate £250 a day each of the 78 working days
of this period. However, if she lost 2 days at the start of the period and fully trained her
employees they could generate £260 a day. What is the opportunity cost of not training her
employees?

3. During the summer you have made the decision to attend summer school, which precludes
you from working at your usual summer job in which you normally earn $6,000 for the summer.
Your tuition cost is $3,000, books and supplies cost $300, and room and board cost $1,000. The
opportunity cost of attending summer school is
A) $3,300
B) $4,300
C) $6,000
D) $10,300

4. The Arigzone Corporation invests $12 million in a new inventory tracking system
5. Mona quits her Rs 50,0000 per year job as an accountant to become a full fledged volunteer
at a women shelter

ANSWERS
1) Earning per hour= Inr.2000
Cost spent on watching IPL=Inr.1000

Total Opportunity cost=Inr.2000*5(hrs) + Inr.1000(ticket cost)

=Inr.11000
2) Without training employee will generate=2*78*250
=39000
With training employee will generate=2*76*260
=39520
Opportunity cost of not training her employees=39520-39000
=Inr.520
3) D) $10,300
4)12 million
5) Inr.500000