A level economics - opportunity cost question

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jiyapatel16272
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Hi, can someone help me with this question?

A driver makes the following estimates in considering the purchase of a car which she intends to
use only when she would otherwise have used public transport.

purchase price of car: 6000

value of car after one year:4500

car operating and repair costs, insurance and taxation for one year: 1800

cost of using public transport for one year instead of travelling by car: 800

potential earnings after tax on $6000 invested for one year: 500


The answer is 3000. Why?
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TSR Jessica
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Sorry you've not had any responses about this. Are you sure you've posted in the right place? Here's a link to our subject forum which should help get you more responses if you post there.
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tmr19
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(Original post by jiyapatel16272)
Hi, can someone help me with this question?

A driver makes the following estimates in considering the purchase of a car which she intends to
use only when she would otherwise have used public transport.

purchase price of car: 6000

value of car after one year:4500

car operating and repair costs, insurance and taxation for one year: 1800

cost of using public transport for one year instead of travelling by car: 800

potential earnings after tax on $6000 invested for one year: 500


The answer is 3000. Why?
The costs involved: Depreciation (1500), operating costs (1800), OC of investing (500) = 3800

Savings: Public transport (800).

3800-800= 3000
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