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JAMB Economics 1978 Question 34

Question 34

Basic Concepts

Opportunity cost is a term which describes

  1. A.the initial cost of setting up a business venture
  2. B.cost of one product in terms of foregone production of others
  3. C.the monetary equivalent of the utility of a commodity
  4. D.costs related to an optimum level of production
  5. E.implicit costs.
Show the answer and explanation

Answer: B (cost of one product in terms of foregone production of others)

Explanation

Opportunity cost is the next best alternative given up, e.g. the other goods that could have been produced instead.