What does the concept of “opportunity cost” mean?

Expert Solution

The concept of opportunity cost reflects the scarcity of resources in the economy.
That is when the resources are scarce, only one good can be produced using those resources.
The opportunity cost shows how one has to give the production of one good in order to produce another one.
Hence it can be defined as the benefit that has been forgone when one is forced to give up a particular choice or option in order to choose another due to the problem of scarcity.
The benefit forgone is hence considered as the "opportunity cost".

Rahul Sunny answered 2 years ago

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What does the concept of “opportunity cost” mean?

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