The principle of opportunity cost is that
A)in a market economy, taking advantage of profitable opportunities involves some money cost.
B)the economic cost of using a factor of production is the alternative use of that factor that is given up.
C)taking advantage of investment opportunities involves costs.
D)the cost of production varies depending on the opportunity for technological application.

Question

Quizplus · Accepted Answer

Opportunity cost is the cost of the next best alternative forgone when making a decision. This means that when a resource or factor of production is used for a certain purpose, the opportunity cost is the value of the next best alternative use of that resource that is given up. This principle is an important concept in economics and helps individuals and businesses make efficient allocation decisions. The other choices do not accurately describe the concept of opportunity cost.

The Principle of Opportunity Cost Is That