When we choose a particular option, we must give up alternative options. The highest-valued alternative forgone is the__________ of the option chosen.
A) absolute advantage
B) opportunity cost
C) comparative advantage
D) nonmonetary cost

Question

Quizplus · Accepted Answer

Opportunity cost is the highest-valued alternative forgone when we choose a particular option. It represents the cost of the next best alternative that we have to give up in order to pursue a certain action or decision. The other options (A, C, D) do not accurately define the concept of opportunity cost.

When We Choose a Particular Option, We Must Give Up