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I'm told that forgone job opportunities are implicit costs, to be included in calculating economic profit, but I can't seem to see how I could list and consider many different forgone opportunities. My question here is how do we do so?

For example, if I have a piece of land or big city real estate, there could be a great many different uses for it. If I considered each of these forgone opportunities an implicit cost, I would think the expression of my economic costs would be useless to me.

So I suspect that either I'm suffering from an oversimplified ECON101 explanation of implicit and opportunity costs or simply an incorrect one. Any references would be appreciated.

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We don't use all possible opportunity costs. We only use the cost of forgoing the next-best-alternative.

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    $\begingroup$ There are two mistakes in your answer: First, opportunity cost is defined as the value (not the cost) of the next best alternative. Second, the cost (or value, for that matter) of the other (lower-ranked) alternatives are not opportunity cost. $\endgroup$
    – Herr K.
    Dec 17 '18 at 21:08
  • $\begingroup$ @HerrK. Good distinction. $\endgroup$
    – TQuile1948
    Jul 5 at 16:58

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