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When studying finance or economic, the cost of a decision is also known as a(n)

Nicholas Rivera

in Business

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1 answer

Jodi Brooks on June 22, 2018

When the study of finance or economics, the cost of a decision is also known as an "opportunity cost".The opportunity cost is one of the financial aspects, a term which refers to the estimate of what you need to deliver with the final goal to choose something different. More or less, is an estimate of the street action is not taken. The idea behind opportunity cost is that, as an entrepreneur, your assets are constantly limited. That is to say, you have a limited measure of time, money and skill, so that you can not exploit every opportunity that goes along. In the remote possibility that you choose one, you basically need to abandon to others. They are totally unrelated. The estimate of the others is its opportunity cost.

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