Store Travel Time And Price Of A Skirt In Minutes And Dollar ✓ Solved
Storetravel Time Each Wayprice Of A Skirtminutesdollars Per Skirtl
Store travel time, opportunity cost of Juanita's time, and total cost of shopping at each location need to be calculated based on the given data. Juanita makes $56 per hour, and the time taken to reach each store, shop, and return affects her opportunity cost. The task involves calculating the opportunity cost of her time for each store and then the total cost, considering both the price of the skirt and her opportunity cost.
First, convert all times into hours to determine the opportunity cost:
- Local Department Store: 15 minutes each way + 30 minutes shopping = 15 + 15 + 30 = 60 minutes = 1 hour
- Across Town: 30 minutes each way + 30 minutes shopping = 30 + 30 + 30 = 90 minutes = 1.5 hours
- Neighboring City: 60 minutes each way + 30 minutes shopping = 60 + 60 + 30 = 150 minutes = 2.5 hours
Next, calculate the opportunity cost:
- Opportunity cost = total travel and shopping time (hours) × hourly wage ($56)
Finally, sum the cost of the skirt and opportunity cost to determine the total cost at each location.
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Sample Paper For Above instruction
Introduction
The cost-benefit analysis of shopping involves more than just the sticker price of the product; it also includes hidden costs such as travel time and opportunity costs. In the case of Juanita, who must take time off work to purchase a skirt, her opportunity cost is a significant factor. This paper calculates the opportunity cost of Juanita's time for each shopping location and determines the total cost incurred, considering both the price of the skirt and her lost income.
Calculating Travel and Shopping Time
Juanita’s travel time varies depending on her shopping destination. At the local department store, her round-trip travel takes 30 minutes, with an additional 30 minutes allocated for shopping. Similarly, across town, her round-trip travel is 60 minutes plus 30 minutes for shopping, while in the neighboring city, her travel time is 120 minutes with the same shopping duration.
Converting these times into hours:
- Local department store: (15 minutes each way) + 30 minutes shopping = (15 + 15 + 30) = 60 minutes = 1 hour
- Across town: (30 minutes each way) + 30 minutes shopping = (30 + 30 + 30) = 90 minutes = 1.5 hours
- Neighboring city: (60 minutes each way) + 30 minutes shopping = (60 + 60 + 30) = 150 minutes = 2.5 hours
Opportunity Cost of Time
Juanita's hourly wage is $56. Therefore, her opportunity cost of time for each shopping trip is:
- Local store: 1 hour × $56 = $56
- Across town: 1.5 hours × $56 = $84
- Neighboring city: 2.5 hours × $56 = $140
These costs represent the income Juanita foregoes by taking time off work to shop at each location.
Calculating Total Cost
The total cost involves summing the price of the skirt with the opportunity cost of Juanita's time:
- Local department store: $100 (price) + $56 (opportunity cost) = $156
- Across town: $86 + $84 = $170
- Neighboring city: $63 + $140 = $203
Discussion
The calculations highlight that although the price of the skirt is lower in the neighboring city, the significant travel time increases the overall cost, surpassing even the more expensive options closer by. This analysis emphasizes the importance of considering opportunity costs in consumer decisions, especially when time is a valuable resource. Juanita might prefer to buy the skirt locally despite its higher price to avoid the higher opportunity cost associated with distant shopping.
Conclusion
When deciding where to purchase a product, consumers should evaluate both the monetary cost and the opportunity cost associated with their time. In Juanita's case, shopping at the local store minimizes her total cost, despite the higher price of the skirt, because it involves less time away from work. This decision-making process underscores the broader economic principle that time is a scarce resource, and its valuation is essential in optimizing consumer choices.
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