Juanita is deciding whether to buy a skirt that she wants, as well as where to buy it. Three stores carry the same skirt, but it is more convenient for Juanita to get to some stores than others. For example, she can go to her local store, located 15 minutes away from where she works, and pay a marked-up price of $114 for the skirt:.

A. store across town

Explanation:

This is a question about opportunity cost. How much is it really costing Juanita to leave work to buy a dress. Let's calculate.

KEY ASSUMPTIONS

She makes $30 per hour.

She takes 30 minutes to shop.

She takes the same time going to the place as the same time coming.

LOCAL DEPARTMENT STORE.

It will take her 15 minutes to get here and 15 back. She will shop for 30 minutes.

Adding all that will be 15+15+30 = 60 mins or 1 hour so she will lose 1 hour in wages if she buys at the local store meaning the total price is her hourly wages + the cost of the dress.

30 + 114 = $144

ACROSS TOWN

It will take her 30 minutes to get here and 30 back. She will shop for 30 minutes.

Adding all that will be 30+30+30 = 90 mins or 1 hour 30 minutes so she will lose 1 hour and 30 minutes in wages if she buys at the store across town meaning the total price is her hourly wages + the cost of the dress.

If 1 hour is $30 dollars then 30 minutes is half of that being $15.

30 +15 + 86 = $131

NEIGHBORING CITY

It will take her 60 minutes to get here and 60 back. She will shop for 30 minutes.

Adding all that will be 60+60+30 = 150 mins or 2 hours 30 minutes so she will lose 2 hours and 30 minutes in wages if she buys at the store in another city meaning the total price is her hourly wages + the cost of the dress.

If 1 hour is $30 dollars then 30 minutes is half of that being $15.

30 + 30 + 15 + 60 = $135

The STORE ACROSS TOWN will cost her the lowest at $131

answer; buyer guide;