from making this choice equals ________.
A) $20
B) $10
C) −$10
D) −$30
Answer: C
Difficulty: Easy
AACSB: Application of Knowledge
Topic: Cost‐Benefit Analysis
28) If a job pays a wage of $50 per hour, but has a non‐wage cost valued at $20 per hour, the net benefit of
taking the job equals ________.
A) $2.5 per hour
B) $20 per hour
C) $30 per hour
D) $70 per hour
Answer: C
Difficulty: Medium
AACSB: Application of Knowledge
Topic: Cost‐Benefit Analysis
19
Copyright © 2019 Pearson Education, Ltd.
Maria has to choose between driving and taking a train to destination A. Traveling by train will cost her
$400 and will take 4 hours. Driving to destination A takes 6 hours, and the required amount of gasoline
costs $250. Her opportunity cost of time is $15 per hour.
29) Refer to the scenario above. What is the total cost involved if Maria chooses to travel by train?
A) $60
B) $400
C) $420
D) $460
Answer: D
Difficulty: Medium
AACSB: Application of Knowledge
Topic: Cost‐Benefit Analysis
30) Refer to the scenario above. If Maria borrows her parentsʹ car and pays for only the gasoline, what is
her total cost of driving to destination A?
A) $90
B) $250
C) $300
D) $340
Answer: D
Difficulty: Medium
AACSB: Application of Knowledge
Topic: Cost‐Benefit Analysis
31) Refer to the scenario above. Maria should choose to ________.
A) drive, as it will save her $120
B) travel by train, because it is quicker
C) drive, as it will give her a real saving of $150
D) travel by train, as it will save her $30 in travel time
Answer: A
Difficulty: Medium
AACSB: Application of Knowledge
Topic: Cost‐Benefit Analysis
32) Refer to the scenario above. If Mariaʹs opportunity cost of time increases to $80 per hour, the cost of
taking the train is ________.
A) $320
B) $720
C) $800
D) $970
Answer: B
Difficulty: Medium
AACSB: Application of Knowledge
Topic: Cost‐Benefit Analysis
20
Copyright © 2019 Pearson Education, Ltd.
33) Refer to the scenario above. If Mariaʹs opportunity cost of time increases to $80 per hour, the cost of
driving to destination A is ________.
A) $480
B) $730
C) $800
D) $970
Answer: B
Difficulty: Medium
AACSB: Application of Knowledge
Topic: Cost‐Benefit Analysis
34) Refer to the scenario above. If the opportunity cost of time increases to $80 per hour, which of the
following statements is true?
A) Maria should choose to drive, as it saves her $10.
B) Maria should choose to drive, as it saves her $150.
C) Maria should choose to travel by train, as it saves her $10.
D) Maria should choose to travel by train, as it saves her $150.
Answer: C