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If money owed to a company is not paid on time and that business makes a better return than the interest rate they charge for accounts receivable investing in some venture or in themselves such as adding another branch of the business in another good location, then the company lost money in the loss of income they could have had at the new branch. This new branch could also be a failure and then there would also be an opportunity cost in what other thing that money could have been doing that would have been a success.

Everything you do in life, every choice you make has a potential opportunity cost, because you could have done something else with your money, time and skills that may have been more productive.

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Q: What is the definition of opportunity cost?
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Definition of scarcity and opportunity cost by Bernardo Villegas?

Opportunity cost refers to the economic benefit forgone by using a resource for one purpose rather than another.


Opportunity cost definition?

The cost of an alternative that must be forgone in order to pursue a certain action. Put another way, the benefits you could have received by taking an alternative action.


What is opportunity cost and opportunity benefit?

Opportunity cost is the cost that an opportunity presents. The opportunity benefit is the benefit of the opportunity that is being presented.


Is an investment an implicit cost?

Yes, investment is an implicit cost because it is a firm investing their own money in something that (by definition of an opportunity cost) could have been invested in something else. Investment is the opportunity cost of a firm using their own money, and whether or not the opportunity that the firm invested in is worthwhile is defined by the NROR (the normal rate of return).


What does the word opportunity cost means?

Opportunity cost means that there is an opportunity to get something in a lower cost. __by Alondra Rico


What calculates the opportunity cost?

Opportunity cost is something for the next porpose.


Is opportunity cost a relevant cost?

Yes, opportunity cost is a relevant cost because it can be used in something more productive.


What do you understand by the term opportunity cost?

Opportunity cost is what you give up in order to get something else. Paying money is the opportunity cost for ice cream for example.


Why does opportunity cost vary?

Opportunity Cost can vary depending on what you are giving up exactly.


Is variable cost part of opportunity cost?

According to Wikipedia and definition with which I agree: Variable costs are expenses that change in proportion to the activity of a business.Variable cost is the sum of marginal costs over all units produced. Opportunity cost on the other hand is not included in the financials in any way shape or form. In manufacturing, electricity can be fixed but a portion can be variable depending on machinery and extended hours. The opportunity cost can be the cost of your time to perform certain duties versus and the benefit from the duty you cannot perform due to the one you chose to perform.


What does increasing marginal opportunity cost mean?

As we decide to choose more units of anything, the opportunity cost of each additional unit will rise. This means that the opportunity cost of the second unit will be greater than that of the first unit. The opportunity cost of the third unit will be greater than that of the second unit. And so forththe law of opportunity cost states that the more of a product that is produced,the greater is its opportunity cost,hence increasing marginal opportunity cost in simple terms refers to an extra or additional opportunity cost of foregoing other products to produce a unit of another product


What is the difference between constant opportunity cost and increasing opportunity cost?

Real cost is the price which is real not a fake price