Answer to Question #134335 in Macroeconomics for notalegt

Question

You plan to travel in Europe this summer.
If you​ do, you​ won't be able to take your usual summer job that pays 9000​$ for the​ summer, and you​ won't be able to live at home for free.
The cost of transportation is 2000​$​, visas cost 100​$​, and living expenses are 1100​$.
What is the opportunity cost of your plan to travel in​ Europe?
Your opportunity cost is what you would have purchased with ​$
nothing if you did not go to Europe.

Answer 1

The opportunity cost of the plan to travel in​ Europe is $12,210. By going to Europe, I will enjoy the pleasure and benefits of the travel and incur a total cost of $3,210 (2000​$​(cost of transportation), 100​$​ (visas cost) and living expenses amounting to 1100​$) and more to that I will have to forego my usual summer job that pays $9000. The opportunity cost of the plan to travel to Europe will be equal to the highest-valued activity that I will give up as I seek to plan to Europe.