Which of the following statements about the opportunity cost of an action is the most accurate?
A) It can be objectively determined only by economists.
B) It can be determined by considering both the benefits that flow from as well as the monetary costs incurred as a result of the action.
C) It is a subjective valuation that can be determined only by the individual who chooses the action.
D) It can be determined by adding up the bills incurred as a result of the action.

Question

Quizplus · Accepted Answer

Opportunity cost is a subjective valuation because it involves the individual's assessment of the value of the next best alternative forgone by choosing a particular action. It cannot be objectively determined by economists or simply by adding up monetary costs, as it also includes non-monetary factors such as personal satisfaction, time, and convenience.

Which of the Following Statements About the Opportunity Cost of an Action