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  • Decision-Making with Mutually Exclusive Alternatives

Definition of Opportunity Cost

Opportunity cost is the value of the next-best alternative that is given up when a particular action is chosen. It represents the benefit you would have received from the forgone option. For example, if the next best alternative to attending a concert is babysitting for a payment of $22, then the opportunity cost of going to the concert is the $22 you could have earned.

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Gemini AI
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Google
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References

Tags

Economics

Economy

Introduction to Microeconomics Course

CORE Econ

Social Science

Empirical Science

Science

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