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2 cards from this section. Quick, good the night before a test.
What does opportunity cost refer to?
Think about what you give up when you make a choice.
Provide an example of opportunity cost.
Consider decisions about your time.
What does opportunity cost represent?
Think about alternatives you consider before deciding.
True or False: Opportunity cost only refers to financial loss.
Consider other factors beyond money.
A company has to decide between investing ₹1,000,000 into research and development or marketing. Calculate the opportunity cost if the expected return on R&D is ₹200,000 and from marketing is ₹300,000.
Compare the potential returns from both options.
If a student spends four years in college for a degree while having had the opportunity to work full-time earning ₹500,000 annually, calculate the total opportunity cost assuming the degree leads to a ₹700,000 per year job afterwards.
Take into account the total income over the four years versus what the degree leads to.
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