Question

Grant has 4 hours of time in all to divide between studying for a physics exam and a geology exam. Table 1 shows his estimates of the grades (on a scale of o to 100) that he could eam from studying a particular number of hours on each subject. If he plans on spending two hours studying physics and two hours on geology, what would be his opportunity cost of an additional hour studying physics? Hours studying Table 1 Physics score 40 Geology score 30 O 50 60 A WN 85 90 90 100 (a) (6) (c) (d) (e) 10 points on his geology exam 20 points on his geology exam 30 points on his geology exam 25 points on his physics exam 85 points on his physics exam

Answer 1

He has maximum 4 hours for study

For 2 hour of study Grant gets 60 score in Physics

For 2 hour of study Grant gets 80 score in Geology

Now if he studies for 3 hours he will score 85 in Physics

but now he will have only 1 hour for studying Geology, for studying 1 hour Geology he will get 60 score

Thus marginal cost of score is = 80 - 60 = 20 score in Geology