A fast-food chain makes the decision to reband itself as a mid range adult cafe instead of a cheap kid friendly restraunt. This change will involve using higher ingrediants and revonating to remove childrens playgrounds
use the passage to answer the scenario
3: What is the opportunity cost in the scenario above?
A:one-time expense renovating restaurants
B:ongoing expense of high-quality ingredients
C:money that is expected to be provided by new adult customers
D:money that could have been made from families with young children
The opportunity cost in the scenario above is D: money that could have been made from families with young children. This is because by rebranding itself as a mid-range adult cafe and removing children's playgrounds, the fast-food chain is essentially giving up the potential profits it would have made from serving families with young children.
The opportunity cost in the scenario above would be option D: money that could have been made from families with young children. By rebranding as a mid-range adult cafe and removing children's playgrounds, the fast-food chain is choosing to forgo the potential revenue they would have generated from families with young children who may have frequented their restaurant.
To determine the opportunity cost in the given scenario, we need to identify the potential benefits foregone or the alternative uses of resources. In this case, the fast-food chain has decided to rebrand itself as a mid-range adult cafe instead of a cheap kid-friendly restaurant. The change involves using higher-quality ingredients and renovating the restaurants to remove children's playgrounds.
The opportunity cost refers to the value of the next best alternative option that had to be given up in order to make the chosen decision. In this scenario, the opportunity cost would be the money that could have been made from families with young children, which is option D.
By rebranding as an adult cafe and removing the children's playgrounds, the fast-food chain is shifting its target customer base from families with young children to adult customers. While this decision may lead to potential financial gains from the new adult customers/customers seeking a mid-range dining experience, it also means that the chain is forfeiting the revenue it could have made from families with young children who may have been regular customers.
Therefore, the correct answer to the question "What is the opportunity cost in the scenario above?" is option D: money that could have been made from families with young children.