Lawrence just got a $1,200 bonus and is debating between buying a new computer for $700 and buying a home theater for $1,500. He decides to buy the computer. What best explains the benefit and opportunity cost of his purchase?

Select the best answer from the choices provided.

Question

Lawrence just got a $1,200 bonus and is debating between buying a new computer for $700 and buying a home theater for $1,500. He decides to buy the computer. What best explains the benefit and opportunity cost of his purchase?

 
Select the best answer from the choices provided.

anonymous · Answer

The opportunity cost is that he cannot afford the home theater; the benefit is having a new computer.
The opportunity cost is that he cannot afford the home theater; the benefit is that he saved $1,200.
The opportunity cost is $700; the benefit is that he still has $800 from his bonus.
The opportunity cost is $700; the benefit is having a new computer.

anonymous · Answer

@jigglypuff314

anonymous · Answer

@RhondaSommer

anonymous · Answer

@Daniellelovee @green_1 @Wendy.Ivette11714 @tiny024

daniellelovee · Answer

I think this is principle

k12awesomeness · Answer

I can help you.. It's A..

daniellelovee · Answer

how are you sure?^

anonymous · Answer

thats what i thought but i wasnt completely sure

daniellelovee · Answer

what is the name of the lesson you are studying?

daniellelovee · Answer

probably 11

daniellelovee · Answer

or 10 those are usually the grades for sociology

daniellelovee · Answer

but what lesson are you studying that might help know exactly what to do

daniellelovee · Answer

and I think the answer is C but I'm not sure

anonymous · Answer

saving money and 12

k12awesomeness · Answer

cool

anonymous · Answer

it cant be c

k12awesomeness · Answer

your right @levils   It ain't C. It's A.

anonymous · Answer

it has to be like a or b

k12awesomeness · Answer

a

daniellelovee · Answer

yeah A is also correct but from this website http://www.investopedia.com/terms/o/opportunitycost.asp the examples make me think that C is the correct one but I might be wrong

anonymous · Answer

An opportunity cost is the cost of an alternative that must be forgone in order to pursue a certain action. Put another way, the benefits you could have received by taking an alternative action

daniellelovee · Answer

not the definition the examples at the bottom

daniellelovee · Answer

The difference in return between a chosen investment and one that is necessarily passed up. Say you invest in a stock and it returns a paltry 2% over the year. In placing your money in the stock, you gave up the opportunity of another investment - say, a risk-free government bond yielding 6%. In this situation, your opportunity costs are 4% (6% - 2%). Read more: Opportunity Cost Definition | Investopedia http://www.investopedia.com/terms/o/opportunitycost.asp#ixzz42cCnCJ2y Follow us: Investopedia on Facebook

daniellelovee · Answer

sorry about the rest but thats one of the examples at it shows the starting value minus the cost=opportunity cost

k12awesomeness · Answer

I would go with  @levils

k12awesomeness · Answer

I would go with A

daniellelovee · Answer

then you can I'm just saying what I think it is but that does not mean that im correct

anonymous · Answer

The opportunity cost is $700; the benefit is that he still has $800 from his bonus

daniellelovee · Answer

was that the answer?

anonymous · Answer

i passed