6 Scarcity opportunity cost and marginal analysis Sam is tra

6. Scarcity, opportunity cost, and marginal analysis Sam is training for a triathlon, a timed race that combines swimming, biking, and running Consider the following sentence: In order to swim for an hour, Sam must take time away from work, where to paying a $5 entrance fee for the pool. Which basic principle of individual choice do these statements best illustrate? The cost of something is what you give up to get it Markets are usually a good way to organize economic activity People usually exploit opportunities to make themselves better off. Trade can make everyone better off

Solution

The cost of something is what you give up to get it.

Opportunity cost is reflected in the given statement as it is the value of next best alternative foregone. In order to swim, person has to give up his work.