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Opportunity cost is the concept of ensuring efficient use of scarce resources, [25] a concept that is central to health economics. The massive increase in the need for intensive care has largely limited and exacerbated the department's ability to address routine health problems.
Economic cost. Economic cost is the combination of losses of any goods that have a value attached to them by any one individual. [ 1][ 2] Economic cost is used mainly by economists as means to compare the prudence of one course of action with that of another. The comparison includes the gains and losses precluded by taking a course of action as ...
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 ...
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.
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 ...
together costs $165.55 at the campus bookstore.7 In STEM classes, students often have an additional cost: They’re required to buy an access code to an online platform used to submit quizzes and assign-ments, which cannot be bought used. Students and advisors told us it is not unusual for a textbook-and-access-code bundle to cost $200 to $300.
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.
The parable seeks to show how opportunity costs, as well as the law of unintended consequences, affect economic activity in ways that are unseen or ignored. The belief that destruction is good for the economy is consequently known as the broken window fallacy or glazier's fallacy.