Check your book for an explanation of double counting costs

(Check your book for an explanation of double counting costs) Consider Diego’s decision to go to college. If he goes to college, he will spend $21,000 on tuition, $11,000 on room and board, and $1,800 on books. If he does not go to college, he will earn $16,000 working in a store and spend $7,200 on room and board. Diego’s cost of going to college is

$49,800.

$42,600.

$33,800.

$57,000.

Solution

The correct option is: $42,600(option : B)

the total cost when he goes to college he spend

21,000 on tuition

11,000 on room and board

1,800 on books

by adding tuition fee + on room and board + on book

21,000 + 11,000 +1,800 = 33,800.

if he does not go to college

he will earn 16,000 working in a store

and spend 7,200 on room and board

16,000 - 7,200 = $8,800.he could save.

by adding both 33,800+8,800 = $42,600