ECONOMICS
OPPORTUNITY COST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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trade-offs
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opportunity cost
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lost opportunities
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options
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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: -Implicit costs (also referred to as implied, imputed or notional costs) are the opportunity costs of utilising resources owned by the firm that could be used for other purposes.
Detailed explanation-3: -OPPORTUNITY COST: The next best alternative given up when making a financial choice.
Detailed explanation-4: -Opportunity cost is the value of what you lose when choosing between two or more options. Every choice has trade-offs, and opportunity cost is the potential benefits you’ll miss out on by choosing one direction over another.
Detailed explanation-5: -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.