ECONOMICS
MONEY MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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is what you give up when you make a decision to buy an item.
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is the amount of money a person has to spend after needs are met.
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describes how you will pay for achieving your personal goals.
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is money deposited for a fixed amount of time at a fixed interest rate.
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Detailed explanation-1: -“Opportunity cost is the value of the next-best alternative when a decision is made; it’s what is given up, ” explains Andrea Caceres-Santamaria, senior economic education specialist at the St. Louis Fed, in a recent Page One Economics: Money and Missed Opportunities.
Detailed explanation-2: -The opportunity cost is the value of what you forgo to pursue something. The term describes the phenomena of choosing not to do something when you make a choice, as you give up one thing in favor of another. An example of opportunity cost might be when you choose between two brands of bread at the grocery store.
Detailed explanation-3: -Opportunity cost refers to what you have to give up to buy what you want in terms of other goods or services. When economists use the word “cost, ” we usually mean opportunity cost. The word “cost” is commonly used in daily speech or in the news.
Detailed explanation-4: -The opportunity cost (also called an implicit cost) of a decision is the value of what you will lose or miss out on when choosing one possibility over another.