Question

if you spend $30 on new clothes you are likely to say new clothes cost you $30 but the money you spend is not the real cost of the new clothes describe what the real cost opportunity cost would be if you spend $30 on new clothes

Answer 1

Answer:

The opportunity cost is a potential gain you lose by choosing one particular alternative over the other. It is the highest benefit of another alternative that you did not choose.  

Let us look at the given example. Say, you earn 10 dollars per hour. It means that you need to work for three hours to be able to buy new clothes for 30$. Meanwhile, you do not enjoy your summer job and would be much happier to spend these three hours hiking with your dog. The joy you have lost by choosing the alternative of earning these 30$ to be able to buy new clothes, is the opportunity cost.