Opportunity Costs
Clark is employed by a company that currently pays him $90,000 per year. He owns a new
car that he bought for cash of $39,000. Clark is thinking about returning to school to obtain
a law degree. Tuition for the school he wants to attend is $29,000 per year, books cost an
average $1,400 per year, and room and board is $17,980 per year.
Determine the total sunk cost and the total opportunity cost for Clark if he decides to
go back to law school for three years.