opportunity cost
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Opportunity cost refers to the value of the next best alternative that is given up when choosing between mutually exclusive options. It is measured as the value of the best alternative forgone or sacrificed to pursue a particular plan of action. The opportunity cost of producing more of commodity X is that less of commodity Y can be produced, and vice versa, since resources have alternative uses and producing more of one thing means producing less of something else.
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RHEOLOGY Physical pharmaceutics-II notes for B.pharm 4th sem students
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opportunity cost
- 1. By : Dhirendra Chauhan Opportunity Cost
- 2. “Opportunity cost is an economics term that refers to the value of what you have to give up in order to choose something else ” Or “Opportunity cost of an activity is equal to the value of next best alternative which is sacrifice or given up or foregone in choosing a given alternative” Opportunity Cost
- 3. “Value of a factor in its next best(Second best) alternative use is called opportunity cost” “Opportunity cost of any commodity is the amount of other good which has been given up(Sacrificed) in order to produce that commodity”
- 7. Diagram X Commodity A B M N X Y x1 x2 y1 y2 Y Commodity x y O Explanation •Opportunity cost of producing more X (X1X2) is less of Y commodity (Y1Y2) •Opportunity cost of producing more Y(Y1Y2) is less of X commodity (X1X2) X1X2 Y1Y2 Y1Y2 X1X2
- 8. THANK YOU