What is an example of opportunity cost in economics?
The opportunity cost is time spent studying and that money to spend on something else. A farmer chooses to plant wheat; the opportunity cost is planting a different crop, or an alternate use of the resources (land and farm equipment). A commuter takes the train to work instead of driving.
What is opportunity cost in macroeconomics?
Opportunity cost is the forgone benefit that would have been derived from an option not chosen. Considering the value of opportunity costs can guide individuals and organizations to more profitable decision-making.
What situation is the best example of opportunity cost?
For example, choosing public transportation to travel to a particular destination by foregoing the option of traveling in one’s own car is a good example of opportunity cost, because you end up saving money which needs to be spent on fuel.
What is an example of opportunity cost in business?
Opportunity cost, on the other hand, refers to money that could be earned (or lost) by choosing a certain option. For example, you purchased $1,000 in new equipment to manufacture backpacks, your number one product. That is a sunk cost.
Which of the following is an example of an opportunity cost quizlet?
The cost of making a choice is that the next best alternative is forgone. This is know as opportunity cost. For example if a Government decides to make the choice of devoting more resources to the NHS then the opportunity cost is devoting those resources into the education system.
Which of the following best represents an example of an opportunity cost you experience by choosing to go to college?
Which of the following best represents an example of an opportunity cost you experience by choosing to go to college? The earnings you would have obtained from getting a job right out of high school. You just studied 62 terms!
Is opportunity cost microeconomics or macroeconomics?
Teaches Economics and Society. Microeconomics is concerned with the decision-making processes of businesses and individuals looking to increase their rate of return. A core motivator in any decision is the concept of opportunity cost.
Which is the best example of opportunity cost quizlet?
Which situation is the best example of opportunity cost? A country chooses to produce bananas instead of wheat. How does specialization enable countries to trade with one another? A country can make and sell goods affordably and buy goods that it is inefficient at making.
How do you calculate opportunity cost in macroeconomics?
Opportunity cost is calculated by applying the following formula: Opportunity Cost = Return on Most Profitable Investment Choice – Return on Investment Chosen to Pursue.
Which scenario is the best example of an opportunity cost quizlet?
Which scenario is the best example of an opportunity cost? A computer company produces fewer laptops to meet tablet demand.
Why is going to college an example of opportunity cost?
Because you chose to go to college instead of working, your opportunity cost is actually the sum of your college expenses plus the money you could have earned had you chosen not to work. Your opportunity cost to attend college is $260k.