Opportunity cost refers to choosing one option over the others and live with the impact and consequence of that choice
Explanation:
All business owners come to experience this opportunity cost and would be left with the option to choose one aspect over the other and they would be ready to face the consequences. If you are a business owner you may ask yourself a question,' what choice am I choosing and will it be profitable if I select this choice over the other?'. This decision can be expressed in terms of opportunity cost.
Opportunity cost can be calculated by what you are sacrificing divided by what you are gaining. Money, time and effort are the three important factors which when sacrificed at the right time in right manner may gain any business owner, but the loss of any of these factors is what determines the opportunity cost.
