Question

Ted is deciding whether or not to attend community college. Tuition costs $1,000 a year and attending college will allow him 10 hours a week of leisure time. Ted’s next best option is to work at his uncle’s factory, which pays $10,000 a year and would a↵ord him 11 hours a week in leisure time. Assume that Ted values leisure at $3 an hour. What are the accounting costs of Ted attending college for a year? What are the opportunity costs? Hint: not all of the information given here is needed for your calculation.