the directors want to give R500 000 to a local school.Give Two reasons why companies take such decision.
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The opportunity cost of computer chip production is 2.
<h3 /><h3>Definition of opportunity cost.</h3>Opportunity cost of the next best option that is forgone when one option is chosen over other options. Opportunity cost is also known as implicit cost.
<h3>Calculation of opportunity cost</h3>In order to determine the opportunity cost divide the number of potato chips by the number of computer chips that can be made.
Opportunity cost = number of potato chips / number of computer chips
50 / 25 = 2
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