1. Business
  2. Economics
  3. i know surplus willingness to pay explicit cost...

Question: i know surplus willingness to pay explicit cost...

Question details

I know Surplus = Willingness to Pay - Explicit Cost, and I know that Opportunity Cost is Explicit Cost + Highest surplus (among remaining alternatives). Net Economic Benefit is Willingness to Pay - Opportunity Cost, however, I do not know how to put these all together to solve for the below problem. Any help would be appreciated.

(3) Consider the following decision problem, where is a real number and net economic benefits have already been calculated: AlternativeNet Economic Benefit Choice 1 Choice 2 3 Se lect the correct answer among the choices below.

Solution by an expert tutor
Blurred Solution
This question has been solved
Subscribe to see this solution