What is an example of opportunity cost for a customer?
A student spends three hours and $20 at the movies the night before an exam. The opportunity cost is time spent studying and that money to spend on something else. A farmer chooses to plant wheat; the opportunity cost is planting a different crop, or an alternate use of the resources (land and farm equipment).
Does opportunity cost include money?
Opportunity cost is the profit lost when one alternative is selected over another. Opportunity cost does not necessarily involve money. It can also refer to alternative uses of time.
Why is opportunity cost not an explicit cost?
Opportunity costs are higher than explicit costs because opportunity costs also include implicit costs. As a result, economic profits are lower than accounting profits. Accountants do not include implicit costs because they are difficult to measure.
What are the limitations of opportunity cost?
The disadvantages of opportunity cost are;
- Time: Opportunity costs take time to calculate and consider.
- Lack of Accounting: Though useful in decision making, the biggest drawback of opportunity cost is that it is not accounted for by company accounts.
What are the assumptions of opportunity cost theory?
(i) The economic system is in a state of full employment equilibrium. (ii) There is perfect competition in commodity and factor markets. (iii) Price of each commodity equals the marginal cost of producing it. (iv) Price of each factor equals its marginal productivity.
What is educational opportunity cost?
An opportunity cost is defined as the value of a forgone activity or alternative when another item or activity is chosen. For example, to define the costs of a college education, a student would probably include such costs as tuition, housing, and books.
What is a synonym for opportunity cost?
Hypernym for Opportunity cost: cost of capital, carrying cost, capital cost, carrying charge.
What word can I use instead of opportunity?
21 alternatives to ‘opportunity’
- advantage.
- aptness.
- break.
- chance.
- circumstance.
- connection.
- convenient situation.
- endeavor.
What is the opposite word of opportunity?
threat
What does it mean to have an opportunity?
noun, plural op·por·tu·ni·ties. an appropriate or favorable time or occasion: Their meeting afforded an opportunity to exchange views. a situation or condition favorable for attainment of a goal. a good position, chance, or prospect, as for advancement or success.
What is a golden opportunity?
: an excellent chance to do or get something.
What is the synonym of by chance?
by luck, accidentally, unexpectedly, circumstantially, haply, perchance. by chance, accidentally, circumstantially, unexpectedly(adverb) without advance planning. “they met accidentally”
What is a fancy word for change?
SYNONYMS FOR change 1 transmute, transform; vary, mutate; amend, modify. 11 vary, mutate, alternate. 19 transmutation, mutation, conversion, vicissitude.
What is a synonym for having a good chance?
other words for good chance possibility. probability. prospect.