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jayboskeet jayboskeet
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3 months ago
Kevin has a lot of free time, and he decides to pick up a new hobby. He has two options—he can take art classes or sign up for cooking classes. He estimates that the art classes would cost him $70 and would provide him with a benefit of $100. In contrast, the cooking classes would cost him $120 but provide him benefits worth $160. Use cost-benefit analysis to arrive at the optimum choice for Kevin.
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Macroeconomics

Macroeconomics


Edition: 3rd
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naderaidenaderaide
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More solutions for this book are available here
Kevin's optimal choice depends on the net benefits of both options:
Net benefit of taking art classes = $100 − $70 = $30;
Net benefit of taking cooking classes = $160 − $120 = $40.
Therefore, given the costs and benefits involved, Kevin should sign up for the cooking classes rather than the art classes.
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this is exactly what I needed
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