1. Doctor Baskin is a dentist, but as a hobby, he restores vintage cars and enters them in auto
shows. Currently, Baskin works at his practice five days a week and forty-eight weeks a year.
Seeing about twenty patients a day, at an average of $50 per patient, the doctor's practice
makes about $5,000 a week, or $240,000 per year. However, Baskin, who loves his hobby
dearly, is considering going to a four-day work week forty-five weeks a year. This will allow
him to spend every Friday working on cars, and will give him three weeks to prepare for
the big shows. Baskin figures that he can go from making $500 per year to $2,500 a year in
prize money at the car shows. If Baskin decides to proceed with the four-day week, what is
his opportunity cost?
A. The decision to change schedules is the opportunity cost.
B. The opportunity cost is the $2,000 increase in prizes and the time spent working on
cars.
C. The opportunity cost is about $58,000 per year (i.e. $60,000 less dentistry income
minus the additional prize income).
D. The opportunity cost is the reduced time spent working on teeth and the increased
time he will be forced to work on cars.