Question

An opportunity cost: Multiple Choice Requires a current outlay of cash. Is an unavoidable cost because it remains the same regardless of the alternative chosen. Is the potential benefit lost by choosing a specific alternative course of action among two or more. Is irrelevant in decision making because it occurred in the past. Results from past managerial decisions.

Answer 1

Answer:

Is the potential benefit lost by choosing a specific alternative course of action among two or more.

Explanation:

An opportunity cost in business management is the potential benefit lost by choosing a specific alternative course of action among two or more. This simply means that, when an options are presented, you will have to choose one among the rest, which eventually leads to a potential benefit lost.

Hence, opportunity cost is generally known as the alternative forgone.

Answer 2

Answer:

Is the potential benefit lost by choosing a specific alternative course of action among two or more.

Explanation:

Opportunity cost is also called the forgone alternative. It is the cost incurred when a particular activity is chosen over another.

For example the opportunity cost for a worker going to the cinema is the wages he would have earned if he went to work.

So it is the benefit forgone for choosing between alternative options.

In economics we do not only consider the cost of an action but also the cost of the alternative forgone. If one buys a ball for $5, the total cost will be the cost of buying the ball and the benefit lost in buying ice cream for example.