The opportunity cost is defined as alternative cost - costs measured in output of products and services forgone.
It can't be defined as variable cost. In the simple formula p = 2q + 100, we can say that 2 is the variable cost. In other words: it's not fixed like the 100.
Opportunity costs are not restricted to financial or monetary costs though. The real costs of output forgone (e.g. when choosing between a number of products like shotguns and bananas), lost time / pleasure, or any other benefit that provides benefit should also be considered opportunity costs. Therefore real costs are part of opportunity costs.
Real cost is the price which is real not a fake price
lots
Opportunity cost or real cost.
Actual cost (real cost): Are those which are actually incurred by the firm in payment for labor, material, plant, building, machinery, equipment ,etc. Opportunity cost: The opportunity cost is the opportunity lost. An opportunity to make income is lost because of scarcity of resources like land, labor, capital etc., or the making of one decision over another decision.
Opportunity cost is the economic, or real cost, of taking any action (as opposed to its accounting, or fiscal, cost). This cost is relevant as part of profit-optimising functions that determine allocations of spending and goods for economic agents.
Real cost is the price which is real not a fake price
lots
lots
Opportunity cost or real cost.
floating-point variable cost
Actual cost (real cost): Are those which are actually incurred by the firm in payment for labor, material, plant, building, machinery, equipment ,etc. Opportunity cost: The opportunity cost is the opportunity lost. An opportunity to make income is lost because of scarcity of resources like land, labor, capital etc., or the making of one decision over another decision.
Opportunity cost is the economic, or real cost, of taking any action (as opposed to its accounting, or fiscal, cost). This cost is relevant as part of profit-optimising functions that determine allocations of spending and goods for economic agents.
Retained earnings have an opportunity cost associated with them because they can be invested to earn more rather than keeping them idle. For example reatined earnings can be invested in a savings account in a bank and earn interest but if this is not done the are loosing some extra income and so if they are invested somewhere else, the bank rate will be the opportunity that has been lost. Opportunity cost is the real cost of choosing one thing and not another.
No. Marginal cost is the added cost of producing one more of something. This type of cost is real and concrete; it actually has monetary value. Opportunity cost is more theoretical. It measures the amount of money / products that could have been made in places other than the job you are currently in. This is very similar to implicit costs.
A nominal variable is a variable measured in current dollars (the value of the dollar for the specific period discussed), and a real variable is a variable measured in constant dollars (the value of the dollar for the base period). That is, a real variable adjusts for the effects of inflation.
Importance of Opportunity cost to an individual are : 1. It influences the individuals household in decision making among his numerous wants. 2. It helps the individual to know how to maximise his satisfaction from his limited resources through drawing scale of preference. Importance of Opportunity Cost to Firms 1. It helps a firm to decide to use labour intensive instead of capital intensive method to achieve the highest output. Importance of Opportunity Cost to Government: 1. It enables the government to maximize the welfare of its citizen by choosing the right projects it should spend its scarce resources on.
It is a monomial.