Question

Bobby is speaking to his friend and says, "this musical is going to cost me $60 when I buy the ticket." His friend corrects him and says, "actually, this concert will cost you more than $60 since you have to miss work." His friend is referring to the _________________.

Answer 1

Full question:

Bobby is speaking to his friend and says, "this musical is going to cost me $60 when I buy the ticket." His friend corrects him and says, "actually, this concert will cost you more than $60 since you have to miss work." His friend is referring to the _________________.

Select the correct answer below:

a)economies of scale

b)budget constraint

c)opportunity cost

d)opportunity set

Answer:

His friend is referring to the opportunity cost

Explanation:

Opportunity costs describe the gains a person, investor or company drops out on when picking one choice over another. The cost of practicing something is previously the cost of the highest-valued alternative use.  Bottlenecks are frequently a condition of opportunity costs.

The method for determining an opportunity cost is solely the contrast within the expected returns of any option. Estimating opportunity costs can lead you to more effective decision-making. Opportunity cost examination also performs a crucial role in preparing a business's capital structure.