thoughtful view
Added by Sarah G.
Step 1
It is the value of the next best alternative that is given up in order to choose a particular course of action. In simpler terms, opportunity cost is the cost of choosing one option or decision, which means you have to give up the benefits or opportunities that Show more…
Show all steps
Your feedback will help us improve your experience
Haricharan Gupta and 98 other Macroeconomics educators are ready to help you.
Ask a new question
Labs
Want to see this concept in action?
Explore this concept interactively to see how it behaves as you change inputs.
Key Concepts
Recommended Videos
What is an opportunity?
The classic example of opportunity cost is the costs of going to college. Illustrate the implicit opportunity cost of foregone income as well as tuition, books, etc. Think about whether room and board should be considered a cost of college. Calculate (in $$$) your opportunity costs of going to college.
Crystal W.
What does increasing marginal opportunity costs mean? What are the implications of this idea for the shape of the production possibilities frontier?
Trade-offs, Comparative Advantage, and the Market System
Production Possibilities Frontiers and Opportunity costs
Recommended Textbooks
Principles of Economics
Macroeconomics
Economics
Transcript
18,000,000+
Students on Numerade
Trusted by students at 8,000+ universities
Watch the video solution with this free unlock.
EMAIL
PASSWORD