Opportunity costs:
A) are incurred in every activity an individual carries out.
B) apply only to individuals' spending and earning decisions.
C) are associated only with decisions involving money outlays.
D) cannot be evaluated since they are costs of alternatives that have been forgone, and therefore, no costs have actually been incurred.

Question

Quizplus · Accepted Answer

Opportunity costs are the benefits or values that are given up when choosing one alternative over another. They are incurred in every decision-making process, not just those involving spending, earning, or explicit monetary outlays. They represent the cost of the next best alternative that is forgone when a decision is made, regardless of whether that decision involves money.

Opportunity Costs