Question

Which diagram best illustrates the economic concept of opportunity cost?

Answer 1

Answer: B

Explanation:

Opportunity cost is a profit or benefit that must be given up on order to acquire something else. Every resource such as money, land, and time can be put to a different use, therefore every choice, action, or decision has an opportunity cost.

Opportunity cost is the value or worth of the next best thing that one gives give up whenever a decision is made. It is the loss of a potential gain from another alternatives when a different alternative is chosen.

When a city invests in repairing its road, the opportunity cost can be not able to afford a museum because the money that could have been used to build a museum has been used for the road.