Opportunity cost is best defined as: A. the monetary price of any productive resource. B. the amount of labor that must be used to produce one unit of any product. C. the ratio of the prices of imported goods to the prices of exported goods. D. the amount of one product that must be given up to produce one more unit of another product.

Question

Business

Gauge Cohen

28 January, 10:46

Opportunity cost is best defined as: A. the monetary price of any productive resource. B. the amount of labor that must be used to produce one unit of any product. C. the ratio of the prices of imported goods to the prices of exported goods. D. the amount of one product that must be given up to produce one more unit of another product.

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Esperanza Norton · Answer 1

D. The amount of one product that must be given up to produce one more unit of another product.

Explanation:

Opportunity cost is defined as the potential benefits that you would recieve if you choose one option over another. This is an economic term that can easily be applied in our day to day lives: Ex. When you choose to study over work, the opportunity cost is represented by the money you could earn as payment for your work.

In business, companies must decide whether they produce a wide range of products or services or if they focus their resources in producing those products in which they are more efficient and would represent higher earnings.