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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.
Production–possibility frontier. In microeconomics, a production–possibility frontier ( PPF ), production possibility curve ( PPC ), or production possibility boundary ( PPB) is a graphical representation showing all the possible options of output for two goods that can be produced using all factors of production, where the given resources ...
Opportunity cost is also often defined, more specifically, as the highest-value opportunity forgone. So let's say you could have become a brain surgeon, earning $250,000 per year, instead of a ...
Opportunity cost is the potential benefits or gains an investor, consumer or business misses out on when one alternative is chosen over another. This might mean spending time at home versus ...
Opportunity Costs is a publication of the Center for an Urban Future. Researched and written by Naomi Sharp and edited by Eli Dvorkin, Laird Gallagher, and Jonathan Bowles. Additional research by Luke Artola, Julia Farley, Katherine Fenlon, Rebecca Rosenberg, Erica Grabowski, Taylor DeStefano, Erin Garret, and Charles Shaviro.
An opportunity cost example of trade-offs for an individual would be the decision by a full-time worker to take time off work with a salary of $50,000 to attend medical school with an annual tuition of $30,000 and earning $150,000 as a doctor after 7 years of study.
Is opportunity cost an ambiguous and arbitrary concept or a simple, straightforward, and fruitful one? This reexamination of opportunity cost addresses this question, and shows that opportunity cost is an ambiguous concept because "two" definitions are in widespread use.
The author then uses the two versions of value to restate in clearer terms the two versions of opportunity cost. He also discusses the problem of identifying the alternative forgone, addresses a few less central quibbles, discusses the importance of a definition, and ends with one more reason to use his preferred version of opportunity cost.