ECONOMICS
DECISION MAKING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The cost of making one decision over another.
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The cost for the opportunity to buy anything you want.
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The opportunity that will cost you loads of money.
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None of the above
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Detailed explanation-1: -The correct answer is b. Benefits foregone by not choosing an alternative course of action. Opportunity cost is the future income or cost that would have been earned or incurred if this alternative was chosen. If not chosen, this would be the given up income or savings of that alternative.
Detailed explanation-2: -Opportunity cost (also known as “alternative cost, ”) is the difference between a project’s cost estimate and another option that must be foregone in order to implement the project. Every choice we make also means giving up another option.
Detailed explanation-3: -Opportunity cost represents the cost of a foregone alternative. In other words, it’s the money, time, or other resources you give up when you choose option A instead of option B. The goal is to assign a number value to that cost, such as a dollar amount or percentage, so you can make a better choice.