Question

Give an example to illustrate how a person may incur an opportunity cost without paying anyone any money.

Answer 1

Answer:

An example that addresses the opportunity cost without involving money, could be: You used your day off cleaning the house, when you could have gone to see your childhood friends.

Explanation:

Opportunity cost is usually established by spending money. This is because money is a scarce resource, which if used in one situation cannot be used in others. To create examples of opportunity cost without using money, we must use another scarce resource, such as time, for example. In this case, a good example would be the time spent cleaning the house, which could have been used to find old friends.