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- Opportunity cost represents the potential benefits that a business, an investor, or an individual consumer misses out on when choosing one alternative over another. While opportunity costs can't be predicted with total certainty, taking them into consideration can lead to better decision making.
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Apr 1, 2024 · Opportunity cost is the potential benefit lost by choosing one option over another. Learn how to calculate opportunity cost, see examples of business and personal decisions, and understand the difference between opportunity cost and sunk cost.
- Jason Fernando
- 2 min
Learn how to use the production possibilities curve (PPC) to illustrate the tradeoffs and opportunity costs of producing two goods. See examples, graphs, equations, and key terms related to the PPC model.
- Helloooo, For discussion question number 1, is it correct if I say: with two product variables in th...Yes, but with a small additional needed element. For example, suppose you can produce either 20 paper airplanes in a day *or* 40 drawings of puppie...
- How can scarcity be represented in the graph of PPC?Answer by example - In the example of rabbits and berries, you have to allocate a scarce resource, namely time, in order to acquire other resources...
- Hi, I'm not quite sure that I understand the Opportunity Cost equation. It says X=(Y1-Y2)/(X1-X2) Bu...The number itself will be the same in either case. What changes is the sign of the equation (in this case negative). This should make sense because...
- What is the difference between opportunity cost and marginal cost? I heard him mentioned the term of...Marginal Cost is simply the opportunity cost of 1 more unit while opportunity cost is not restricted to just one unit
- How does the concept of opportunity cost help explain the trade-offs depicted by points inside, on, ...*Inside the PPC*: Inefficient, missing out on potential production of both goods. *On the PPC*: Efficient, maximizing production of both goods. *Ou...
- Why does it mean when opportunity cost is constant along the ppc? I know it’s because of the linear ...Hmmm… other things about a Constant Opportunity Cost of a Production Possibilities Frontier, PPF, or Curve PPC… So I believe you already understand...
Opportunity cost refers to what you have to give up to buy what you want in terms of other goods or services. When economists use the word “cost,” we usually mean opportunity cost. The word “cost” is commonly used in daily speech or in the news.
Mar 29, 2019 · Opportunity cost is the next best alternative foregone when making a choice. Learn how to calculate and apply opportunity cost with examples, production possibility frontiers and comparative advantage.
Opportunity cost, as such, is an economic concept in economic theory which is used to maximise value through better decision-making. In accounting, collecting, processing, and reporting information on activities and events that occur within an organization is referred to as the accounting cycle.
Opportunity cost is the trade-off that one makes when deciding between two options. Learn how to calculate opportunity cost using the production possibilities curve and see how it differs from marginal cost.
- 6 min
- Sal Khan
May 15, 2024 · Opportunity cost is the value of the next best alternative forgone in a choice. Learn how economists use this concept to compare the relative monetary values of goods and services.
