Asked by
Danah Mongan
on Nov 12, 2024Verified
An opportunity cost is:
A) a cost which may be saved by not adopting an alternative.
B) the difference in total costs which results from selecting one alternative instead of another.
C) a cost which may be shifted to the future with little or no effect on current operations.
D) the potential benefit forgone by selecting one alternative instead of another.
Opportunity Cost
The value of the best alternative that is foregone by choosing a particular action or decision, important in evaluating the cost of choices.
Alternative
An option among a set of choices in decision-making scenarios.
Total Costs
The sum of all expenses incurred by a business in producing goods or services, including fixed and variable costs.
- Distinguish between opportunity costs, sunk costs, and how they relate to decision-making.
Verified Answer
JC
Learning Objectives
- Distinguish between opportunity costs, sunk costs, and how they relate to decision-making.
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