# Michelle Wie, a teenage golf prodigy who earned $16 million in endorsements and$4 million in...

## Question:

Michelle Wie, a teenage golf prodigy who earned {eq}\$16 {/eq} million in endorsements and {eq}\$4 {/eq} million in prize money and appearance fees in 2006, announced that she would enroll as a student at Stanford University in the fall of 2007. What was her opportunity cost of a year of college?

## Opportunity costs

Opportunity cost defined as the benefits lost when a person chooses one alternative over another alternative. In other words, it is the "cost" incurred by not choosing the benefits involved with the nest best alternative option.

In this case, If Michelle Wie choose to get enroll as a student at Stanford University, She has to sacrifice the income of $16 +$4 = $20 which she could have earned in 2007. Thus, her opportunity cost of a year of college is$20.