A fast food chain makes the decision to rebrand itself as a mid range adult café instead of a cheap kid friendly restaurant this change will involve using higher quality ingredients and renovating to remove children’s playground

Question

A fast food chain makes the decision to rebrand itself as a mid range adult café instead of a cheap kid friendly restaurant this change will involve using higher quality ingredients and renovating to remove children’s playground

Use the passage to answer the question
What is the opportunity cost in the scenario above?
One time expense of renovating restaurants
Expense of high-quality ingredients
Money that is expected to be provided by new adult customers
Money that could have been made from families with young children inside

Answer 1

The opportunity cost in this scenario is money that could have been made from families with young children inside. By rebranding as a mid-range adult café and removing the children's playground, the restaurant is potentially losing out on revenue from families with young children who would have previously visited the restaurant.