ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Store
Local Shoe Store
Different Neighborhood in Town
Rural Outlet
Travel Time Each Way
(Minutes)
15
30
60
Juanita earns an hourly wage of $34 at her job. In order to purchase her boots she will have to take time off work, so each hour away from her job
costs her $34 in lost income. Assume that Juanita's travel time is the same each way (to and from the store) and that it will take her 30 minutes once
she reaches a store to complete her shopping. Assume throughout the question that Juanita incurs no additional costs other than the boots, such as
gas.
Store
Local Shoe Store
Price of a Boots
(Dollars per boots)
110
103
82
Complete the following table by computing the opportunity cost of Juanita's time and the total cost of shopping at each location.
Opportunity Cost of Time
(Dollars)
Price of a Boots
(Dollars per boots)
110
Total Cost
(Dollars)
103
82
Different Neighborhood in Town
Rural Outlet
Assume that Juanita considers both her opportunity costs and the price of boots when making her shopping decision. Juanita will minimize her cost of
buying the boots if she shops at the
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Transcribed Image Text:Store Local Shoe Store Different Neighborhood in Town Rural Outlet Travel Time Each Way (Minutes) 15 30 60 Juanita earns an hourly wage of $34 at her job. In order to purchase her boots she will have to take time off work, so each hour away from her job costs her $34 in lost income. Assume that Juanita's travel time is the same each way (to and from the store) and that it will take her 30 minutes once she reaches a store to complete her shopping. Assume throughout the question that Juanita incurs no additional costs other than the boots, such as gas. Store Local Shoe Store Price of a Boots (Dollars per boots) 110 103 82 Complete the following table by computing the opportunity cost of Juanita's time and the total cost of shopping at each location. Opportunity Cost of Time (Dollars) Price of a Boots (Dollars per boots) 110 Total Cost (Dollars) 103 82 Different Neighborhood in Town Rural Outlet Assume that Juanita considers both her opportunity costs and the price of boots when making her shopping decision. Juanita will minimize her cost of buying the boots if she shops at the
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