Kevin has $20 to spend on summer clothes. he is looking at shirts, shorts, and flip-flops. shirts are $10, shorts are $15, and flip-flops are $10. which of the following statements best describes the opportunity costs and benefits of buying a shirt?

select the best answer from the choices provided.
a.
the opportunity cost is $10; the benefit is that he now has a shirt.
b.
the opportunity cost is that he cannot afford the shorts; the benefit is that he now has a shirt.
c.
the opportunity cost is $10; the benefit is that he saved $15.
d.
the opportunity cost is that he cannot afford the shorts or the flip-flops; the benefit is that he saved $10.

Kevin has analyzed the situation well. However, he should also consider the fact that he saved $10 by only purchasing the shirt.

Opportunity cost is the cost of the forgone alternative. Out of the 3 choices, he only purchased 1 of the choices, the opportunity cost are the other two choices. However, he is still capable of buying the flip-flops costing $10 but he chose not to do so. He should consider it as a savings aside from it being a lost opportunity.

answer: nobody

explanation:

urban company reports the following information regarding its production cost: units produced 37,000 units direct labor $ 30 per unit direct materials $ 35 per unit variable overhead $ 237,000 in total fixed overhead $ 127,000 in total