Question

Select the correct answer. Which economic term represents the value of the second-best alternative that an individual gives up when making a choice? A. marginal spending B. marginal benefit C. opportunity cost D. marginal cost

Answer 1

Answer: Opportunity cost

Explanation:

The economic term which represents the value of the second best alternative that someone will give up when making a choice is refered to as the opportunity cost.

The opportunity cost is the cost of what we forgo as an individual when we make another decision. For example, if I've an option of playing football or going to work and earning $20, if I choose to play football, the opportunity cost will be the $20 that I won't get for choosing a different alternative.