A cost that is measured by the benefits forgone from an alternative use of resources is called a(n):

Question

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Opportunity cost is the cost of giving up the next best alternative. It is an important concept in economics because resources are scarce, and therefore, every time a choice is made to use resources for one purpose, the opportunity cost of not using them for the next best alternative is incurred. Sunk cost is a cost that has already been incurred and cannot be recovered. Differential cost is the difference in cost between two alternatives. Standard cost is a predetermined cost. In this question, the cost that is being measured by the benefits forgone from an alternative use of resources is the opportunity cost.

A Cost That Is Measured by the Benefits Forgone from an Alternative