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    Define opportunity cost, does every business choice have an opportunity cost and give an example of a business practice with an economic cost that is different than its accounting cost

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    Define opportunity cost, does every business choice have an opportunity cost and give an example of a business practice with an economic cost that is different than its accounting cost. Give an example of a business practice with an opportunity cost that is different than its monetary cost. And can the opportunity cost of a given resource use be different for different companies and/or be different for the same company at different times.

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    Solution Preview

    Remember - I cannot answer the question directly for you, but I can point you in the right direction.
    The good news is that "opportunity cost" is a simple concept and is fundamental to all economics

    Excellent article from a good source: http://econlib.org/library/Enc/OpportunityCost.html

    The simple concept is that opportunity cost refers to that which you DO NOT do as a direct consequence of what you DO. Both of these concepts must be used together.
    Spending $1 on item x means that you do not have that dollar for item y. Simple enough.

    Monetary cost is the simplest cost of all - it's just what you spend on something you want.

    You can consider a non-monetary cost in terms of time. If you own a business, and you take time to study the written works of major businessmen (like Warren Buffet, say), you can say that you could have ...

    Solution Summary

    The expert determines if business choices have an opportunity cost. Examples are provided.

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