Learn Before
Evaluating a Job Offer Decision
An individual is considering a new job offer. The new job has a salary of $75,000, but it will introduce new annual commuting costs of $5,000. Their current job pays $60,000 and includes a gym membership they value at $1,000 per year, which they would lose if they switch. The individual reasons: 'The new salary is $15,000 higher, and the new costs are only $5,000, so the pay-off for switching is $10,000.' Is this reasoning correct? Explain your answer and provide the correct calculation for the pay-off of switching jobs.
0
1
Tags
CORE Econ
Economics
Social Science
Empirical Science
Science
Economy
Introduction to Microeconomics Course
The Economy 2.0 Microeconomics @ CORE Econ
Ch.2 Technology and incentives - The Economy 2.0 Microeconomics @ CORE Econ
Evaluation in Bloom's Taxonomy
Cognitive Psychology
Psychology
Related
A company is considering two marketing campaigns. Campaign A has total expected benefits valued at $50,000 and total costs of $15,000. Campaign B has total expected benefits valued at $65,000 and total costs of $32,000. To achieve the highest possible pay-off, which campaign should the company choose?
Evaluating a Business Decision
Calculating Net Benefit of a Project
An individual decides to purchase a new video game. They calculate that the net benefit, or pay-off, from this decision is $20. If the total benefit they receive from the enjoyment and entertainment of the game is valued at $80, what was the total cost of the video game?
A student is considering a weekend trip. They value the enjoyment and relaxation from the trip at $300. The direct costs for the trip are a $150 hotel room and $50 for gas. To go on the trip, they must also miss a weekend work shift where they would have earned $120.
Statement: The pay-off from taking the weekend trip is positive.
Investment Decision for a Cafe
Evaluating a Personal Finance Decision
Evaluating a Job Offer Decision
A rational decision-maker analyzes the pay-off of an action before proceeding. For each of the following independent scenarios, calculate the net benefit by subtracting total costs from total benefits, and match the scenario to its correct net benefit value.
A farmer is considering planting a new crop. The total expected benefits from the harvest are valued at $8,500. The total costs for seeds, fertilizer, and labor amount to $3,200. The net benefit, or pay-off, from planting this new crop is $____.
Calculating Net Benefit of a Project
An individual decides to purchase a new video game. They calculate that the net benefit, or pay-off, from this decision is $20. If the total benefit they receive from the enjoyment and entertainment of the game is valued at $80, what was the total cost of the video game?