Recent Examples of opportunity cost from the Web
The Kid Vid rules also create major opportunity costs for adult viewers.
Actually, teams of analysts work every day to scrutinize competitive dynamics of markets, opportunity costs of flights and even the times of day, Hauenstein said.
The direct economic costs may be over $20 billion and the opportunity costs of losing over 250,000 workers a year could be around $200 billion a year.
Another possibility is that schooling raises the opportunity cost of getting pregnant, by giving girls more to lose.
That’s where strategic quitting — and understanding opportunity costs — comes in.
In other words, the opportunity cost of sitting on your hands was less than half as much.
Verlander is a rate risk, and his opportunity cost includes passing on the likes of Andrew Benintendi, Jose Abreu, Zack Greinke and Yu Darvish.
The emotional cost and economic cost and opportunity cost that women are enduring and taking on [is huge].
These example sentences are selected automatically from various online news sources to reflect current usage of the word 'opportunity cost.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.
Financial Definition of OPPORTUNITY COST
What It Is
Opportunity cost refers to the value forgone in order to make one particular investment instead of another.
How It Works
For example, let's assume you have $15,000 that you could either invest in Company XYZ stock or put toward a graduate degree. You choose the stock. The opportunity cost in this situation is the increased lifetime earnings that may have resulted from getting the graduate degree -- that is, you choose to forgo the increase in earnings when you use the money to buy stock instead.
Here's another example. Let's say you have $15,000 and your choice is to either buy shares of Company XYZ or leave the money in a CD that earns only 5% per year. If the Company XYZ stock returns 10%, you've benefited from your decision because the alternative would have been less profitable. However, if Company XYZ returns 2% when you could have had 5% from the CD, then your opportunity cost is (5% - 2% = 3%).
Why It Matters
Opportunity cost is all about the most basic of economic concepts: trade-offs. It's a notion inherent in almost every decision of daily life and of investing: if you make a choice, you forgo the other options for now. And what's been given up can sometimes turn out to have been the wiser choice, which is why opportunity cost is best measured in hindsight -- after all, it is impossible to know the end outcome of any investment.
legal Definition of opportunity cost
Learn More about opportunity cost
Britannica.com: Encyclopedia article about opportunity cost
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