When choosing between alternatives, the contribution margin of the next best alternative is called
A)incremental revenue.
B)opportunity cost.
C)sunk cost.
D)incremental analysis.

Question

Quizplus · Accepted Answer

The contribution margin of the next best alternative is called the opportunity cost. This is the cost of forgoing the next best alternative. Therefore, when choosing between alternatives, it is important to consider the opportunity cost in order to make the best decision.

When Choosing Between Alternatives, the Contribution Margin of the Next