opportunity cost

noun

: the added cost of using resources (as for production or speculative investment) that is the difference between the actual value resulting from such use and that of an alternative (such as another use of the same resources or an investment of equal risk but greater return)

Examples of opportunity cost in a Sentence

Recent Examples on the Web
Examples are automatically compiled from online sources to show current usage. Read More Opinions expressed in the examples do not represent those of Merriam-Webster or its editors. Send us feedback.
That puts an opportunity cost to every dollar spent on player salary, but there is no such limitation to money spent on the rest of the organization. Mike Vorkunov, New York Times, 19 June 2025 The opportunity cost —in terms of sustainable growth, prosperity, and planetary stability—is immense. Sturla Henriksen, Time, 5 June 2025 Higher interest rates for longer would increase the opportunity cost of holding gold. Garth Friesen, Forbes, 15 Mar. 2025 There's an opportunity cost to taking all those extra months, weeks, and days to make a single decision. Nell Wulfhart, CNBC, 2 June 2025 See All Example Sentences for opportunity cost

Word History

First Known Use

1894, in the meaning defined above

Time Traveler
The first known use of opportunity cost was in 1894

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Cite this Entry

“Opportunity cost.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/opportunity%20cost. Accessed 4 Jul. 2025.

Legal Definition

opportunity cost

noun
op·​por·​tu·​ni·​ty cost
: the cost of making an investment that is the difference between the return on one investment and the return on an alternative

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