The cost associated with foregoing the opportunity to employ a resource in its best alternative use is called
A) A sunk cost
B) An opportunity cost
C) A fixed cost
D) Total cost

Question

Quizplus · Accepted Answer

The cost associated with foregoing the opportunity to employ a resource in its best alternative use is called an opportunity cost. Sunk cost refers to the cost that has already been incurred and cannot be recovered, fixed cost refers to the cost that remains constant regardless of the level of production, and total cost refers to the sum of all costs incurred in producing a particular quantity of output.

The Cost Associated with Foregoing the Opportunity to Employ a Resource