# Questions tagged [opportunity-cost]

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### In the long run, would a production-possibility curve expand outward if the country preferred more consumer goods than capital goods?

PPC will not expand outward if the country preferred more consumer goods than capital goods. The total amount of resources in an economy at any given point of time is fixed. If a country ...
• 139
1 vote
940 views

### Is the opportunity cost under the supply curve?

Is it correct to say that the opportunity cost is a particular point on the supply curve? And if so, why? I understand what is going on with the opportunity cost with the production possibilities ...
280 views

### Why is the opportunity cost 0 in this case?

My book says that the opportunity cost of purchase of a specialized equipment that has no alternative use is zero and hence such an expenditure is a sunk cost. However, while calculating the user cost ...
• 167
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### What is an opportunity cost?

Mankiw's definition and explanation of opportunity cost here is confusing. Since when have explicit costs become part of opportunity cost? Here is what the guide says: The concept of opportunity ...
• 2,010
1k views

### Opportunity profits vs. opportunity costs

Having learned that Opportunity costs = the costs for avoided profits are a well established and quite useful economic concept, I wonder how its counterpart is officially called and investigated: ...
6k views

### How to calculate the after tax WACC

So i have this question: Assume the following data for U&P Company: Debt (D) = $100 million; Equity (E) =$300 million; rD = 6%; rE = 12%; and TC = 30%. Calculate the after-tax weighted average ...
32 views

### Simple cost analysis question

I am stuck at a very simple problem: Suppose, I am running out of insurance, and as a result, I am incurring a the cost of A with event 1 + the cost of B with event 2. Now, I go ahead and buy an ...
• 103
525 views

### Are opportunity costs synonymous with economic costs?

I was working on a question that asked the opportunity costs of going to college per year given that college tuition is $x$ and the salary per year is $y$. The answer given is $x + y$. I ...
• 790
1 vote
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### Why (Im) is gross(before personal tax-BPT) rate of return(ROR) by saver?It should be net ROR & APT, as SS' curve is after personal tax is imposed [closed]

![the image was taken from public finance book by Musgrave and Musgrave ]1Pave 156(fig. 9.5)
207 views

### How is "opportunity cost" an useful concept? Even when it does exist?

How is "opportunity cost" an useful concept? Even when it does exist? What use does it serve?
• 305
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### Production Possibility Frontier and Opportunity cost

The following is a list of data points on a PPF, answer questions regarding opportunity cost. What is the opportunity cost of producing the first 500 Toyota? The opportunity cost of producing the ...
• 31
5k views

### What is Opportunity Cost?

Suppose you have 2 activities, A and B. Doing activity A gives a return of 100 dollars, doing activity B gives a return of -50 dollars. What would be the opportunity cost of choosing activity B? 100 ...
• 31
961 views

### What is the opportunity cost if I choose the option of highest value

I had a confusion about opportunity cost. Suppose I have three alternatives which can be completed in same time, and can provide me the value of \$30, \$10 or \$40. If I choose the one with \$10 then,...
• 113
449 views

### Did I calculate maximum price of machine correctly?

Problem: A firm wants to buy a machine for its factory. It will work for two years. During the first year it will yield 240 thousand roubles and during the second year it will yield 200 thousands ...
• 1,135
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### Does Average Total Cost (ATC) include implicit opportunity costs?

Does the average total cost include opportunity costs? If so, are these opportunity costs considered fixed costs or variable costs? How are they calculated.
• 103
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### Does Game theory consider opportunity cost?

Morton Davis in his book Game Theory: A non-Technical introduction brings the following example of a non-zero sum game (pg.73) : A Buisness Partnership A builder and an architect are jointly offered ...
• 869
1 vote
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### Question on an argument in "The Myth of Absolute Advantage"

Brandis (1967) argues that "absolute advantage does not exist" and "that it is a logical impossibility". (See also comment, comment, reply.) My question here is very narrow and specific. I do not ...
88 views

### How to analyze small human activities from the economical standpoint?

If a company has project A and project B it can decide what is more profitable. The math in this example is straightforward. If human has activity A and activity B, how can someone calculate what is ...
1 vote
423 views

### Is opportunity cost market prices of input goods or income from alternative investments?

Reading my development economics textbook, I was informed that the opportunity cost of a private investment is the market value of the wages, goods and services used for the investment. Here's a ...
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### What would make a restaurant offer all-day breakfast?

Some restaurants particularly fast food ones offer breakfast food only during, well, breakfast hours. Other restaurants however offer breakfast food throughout their opening hours. Some restaurants ...
• 370
1 vote
223 views

### Have any economists ever argued that the notion of opportunity cost should be done away with?

I hold the opinion that the notion of opportunity cost "muddies the intellectual waters" so to speak, and I'd like to know if any professional economists have expressed this sentiment, or similar. ...
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