Question: 1 tiger woods dropped out of stanford university to pursue...
1. Tiger Woods dropped out of Stanford University to pursue a
career as a professional golfer. At the time he left the
university, he was majoring in finance and would have been
employable as a stock broker or financial analyst earning
$150,000/year. When he turned pro, he immediately signed an
endorsement contract with Nike for $20 million.
a. What was Tiger’s opportunity cost for becoming a professional golfer?
b. Opportunity costs occur when decisions are made. Economists recommend that those decisions be based on what?
c. Are opportunity costs always measured in dollar terms? Explain.
d. You will spend about 90 minutes on this exam. What is your opportunity cost for spending your time in that manner?
2. You plan to attend college. Answer the following
a. What are the explicit (cash out of pocket) costs of attending college? What are the implicit (lost opportunities) of attending college.
b. You will not have any current rock stars or major league ball players attending your classes. Why not?
c. Assuming everyone has equal intelligence, college will still not be the right choice for everyone. Using the concept of opportunity costs, explain why.