Suppose that you could either prepare your own tax return in 8 hours or hire a tax specialist to prepare it for you in 2 hours. You value your time at$20.00an hour; the tax specialist will charge you $45 an hour. The opportunity cost of preparing your own tax return is
A)$250.
B)$45.
C)$90.
D)$160.

Question

Quizplus · Accepted Answer

The opportunity cost of preparing your own tax return is the value of your time spent on it, which is 8 hours at $20 per hour, totaling $160.

Suppose That You Could Either Prepare Your Own Tax Return