Stuck in Cleveland You purchased a roundtrip ticket to a friend's ...

[P68T]

Stuck in Cleveland You purchased a roundtrip ticket to a friend's wedding in Cleveland on Saturday for 400, but on Sunday you discover your return flight is canceled due to weather. The airline will not be able to get you back home until late Monday but Greyhound has an overnight bus route that arrives at 6:00am Monday for 60 . What is the opportunity cost of missing work on Monday?

Question 2

Owners of a parking lot are deciding whether or not to add more parking spaces to the lot. The owners should stop adding parking spaces where:
 a. LRMR=LRMC
 b. LRMR>LRMC
 c. LRMR d. None of the above

[nital]

Answer to Question 1

Since the airline will fly you later, it will not cost any more to get home if you are willing to miss work on Monday. But if you want to be at work on Monday, the airline ticket is a sunk cost. At this point, the cost of being at work on time, if a bit haggard, is the 60 bus fare.

Answer to Question 2

a

[P68T]

Thanks for the timely response, appreciate it

[Joy Chen]

TYSM