Steve returned from a fishing trip and caught 2 salmon. His wife does not like fishing and discouraged him to go and presented him with cost data. The cost per trip based on an averge of 10 trips per year
Which of the following cost are relevant:
Depreciation on fishing boat (annual depr. 1500 div. by 10 trips)$150
Boat storage fees (annual rental 1200 div. by 10 trips) $120
Expenditure on fishing gear except snagged lures (annual exp. 200 div by 10 trips) $20
Snagged fishing lures $7
Fishing license (yearly license 40 div by 10 trips) $4
Fuel and upkeep on boat per trip $25
Junk food consumed during trip $8
Total cost $334
Cost per salmon: 334 div by 2 $167
What are the relavant cost

they are all relevant

some are direct costs attributed to the actual trip and some are fixed costs incurred whether you go or not.

I would say what is more relevant is the opportunity cost of the price of two fish at the fishmongers

Sounds like a math homework question to me. Otherwise I'd point out the girl stuff she wastes money on over the course of a year....

She was just frustrated that he spent his time with his boat and didn't spend his money on her, afterall how many hairdo's can you get for the price of one fishing trip

... or how many pairs of shoes or handbags.


Hell...as long as money is being put asside for savings and retirement....he earned it, he's entitled to enjoy a little bit of it.

Can't think many guys living paycheck to paycheck take those sorts of trips anyway.