1.5 Business Choices Flashcards
1
Q
Put simply what is an opportunity cost:
A
What you can no longer do because you went with a different option.
2
Q
What is the proper definition of an opportunity cost?
A
The cost of the next best alternative forgone when making a decision.
3
Q
What is a trade off?
A
A compromise:
By a firm having more of one thing they have less of another
4
Q
What is an example of an opportunity cost?
A
By a business buying 2 tractors the opportunity cost is the benefits that could have come from another project they can no longer do.
5
Q
What is an example of a trade off
A
If a company wants to be ethical they will likely have higher costs.
