Quick Answer: What’s A Possible Opportunity Cost When You Spend $100 On A Pair Of Sneakers?

What is the basic premise of an opportunity cost?

The idea behind opportunity cost is that the cost of one item is the lost opportunity to do or consume something else; in short, opportunity cost is the value of the next best alternative.

What is the basic premise of an opportunity cost Brainly?

Answer: When you buy something, you are foregoing all the other things you could have bought instead. Explanation: Opportunity cost is an economic concept that refers to the cost of giving up certain factors as a result of choosing a specific factor.

What is a real life example of opportunity cost?

Examples of Opportunity Cost. Someone gives up going to see a movie to study for a test in order to get a good grade. The opportunity cost is the cost of the movie and the enjoyment of seeing it. At the ice cream parlor, you have to choose between rocky road and strawberry.

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Why is opportunity cost not an explicit cost?

Accounting profit is total revenue minus explicit cost. Opportunity costs are higher than explicit costs because opportunity costs also include implicit costs. As a result, economic profits are lower than accounting profits. Accountants do not include implicit costs because they are difficult to measure.

What is the opportunity cost of a decision?

What Is Opportunity Cost? 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.

What is definition of opportunity cost?

Opportunity costs represent the potential benefits an individual, investor, or business misses out on when choosing one alternative over another. Understanding the potential missed opportunities foregone by choosing one investment over another allows for better decision-making.

What is the opportunity cost of a decision Brainly?

The opportunity cost of a decision is the things that are lost, or given up, to gain something else.

What is opportunity cost give examples?

What are some other examples of opportunity cost? A student spends three hours and $20 at the movies the night before an exam. The opportunity cost is time spent studying and that money to spend on something else.

What is opportunity cost and example?

When economists refer to the “ opportunity cost ” of a resource, they mean the value of the next-highest-valued alternative use of that resource. If, for example, you spend time and money going to a movie, you cannot spend that time at home reading a book, and you can’t spend the money on something else.

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Which situation is best example of opportunity cost?

It is the important concept in economics and also the relationship which is between choice and scarcity. A good example of opportunity cost is you can spend money and time on other things but you can not spend time reading books or the money in doing something which can help.

Is opportunity cost the same as implicit cost?

The main difference between the two types of costs is that implicit costs are opportunity costs, while explicit costs are expenses paid with a company’s own tangible assets. This makes implicit costs synonymous with imputed costs, while explicit costs are considered out-of-pocket expenses.

Is opportunity cost included in total cost?

Total cost in economics, includes the total opportunity cost (benefits received from the next-best alternative) of each factor of production as part of its fixed or variable costs. The additional total cost of one additional unit of production is called marginal cost.

What is the difference between scarcity and opportunity cost?

Scarcity refers to as less than, inadequate in supply to limited supply of economic resources in relation to unlimited human wants. Opportunity cost is also known as a real cost or time cost. The two are also present in the lives of individuals in a free market economy.

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