Karen chooses to go to university full-time rather than to work. Karen:

• A. is facing an opportunity cost equal to the income she could have earned by working
• B. does not experience any opportunity cost because education is always beneficial
• C. will have no trade-offs as a result of her decision
• D. is making a choice without considering scarcity

Answer: (A)

Verified step by step guidance

1. Understand the concept of opportunity cost: it is the value of the next best alternative foregone when making a choice.
2. Identify Karen's choice: she chooses to attend university full-time instead of working.
3. Determine what Karen gives up by attending university: the income she could have earned by working during that time.
4. Recognize that even though education has benefits, the opportunity cost includes the foregone earnings, which is a real trade-off.
5. Conclude that Karen is facing an opportunity cost equal to the income she sacrifices by not working while studying.