1. You have already purchased (non-refundable and unsellable) tickets to a concert on Friday night. A friend also invites you to her birthday party on Friday. While you like your friend, you politely decline because you really want to go to the concert.

a. You learn that your friend is serving flank steak at her party, all-you-can eat and at no charge. Flank steak is your favorite food. Should this affect your decision to go to the concert? Explain by using the term “opportunity cost.”

b. Suppose instead that you notice that the non-refundable concert ticket (that you already purchased) cost you $10; previously you had mistakenly believed the price was $100. Should learning this information affect your decision to go to the concert?