Md.

Harun Ar Rashid/ ID: 43

1. Give an example of a trade-off that you have recently faced and that has both a monetary
and a non-monetary opportunity cost.

Answer: Trade-off means that if we want to buy an economic good then we will demand an
economic good. So this means if I want to buy chocolates then I will have to pay the shopkeeper
money. Anything that we buy has a monetary value and we have to compensate seller for that.
That's trade-off.

Suppose I received a contract for my summer job at a warehouse in Narayanganj. The salary of
the job is 5000 Taka per week plus room. The contract is written for the entire month of May.
However, I am going to work only until May 27, so I can have a vacation with my extended
family during the last week of May. I will be trading-off my salary and room and board for the
chance to enjoy time with my family. The "opportunity cost" of the family vacation is the salary
and food and fun I'll be giving up in order to have a different type of fun with my relatives.