Economics 0455 · IGCSE · Opportunity cost

Opportunity cost — practice question

A student has no plans for a Friday evening. She withdraws $5 from the $100 she keeps in a savings account and uses it to buy a gift to bring to a party, where admission costs nothing. What does this involve?

  • Aan opportunity cost equal to $95
  • Ban opportunity cost equal to other goods she could have bought for $5
  • Cno opportunity cost, as entrance to the party is free
  • Dno opportunity cost, as she had no better way of using the time

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