Opportunity Cost

opportunity appeal is defined by Sloman and Norris as (1999, pg. 09) the appeal of any activity measured in terms of the best resource forg cardinal. It is important to note that the definition refers to the best pick forg sensation, not the top three alternatives or top ten. outlook cost is nevertheless concerned with the result of making a particular decision and the losses incurred or the impact that selection exit have. Making what may be considered to be the the right way decision at the time is based various criteria, just about of which will be influenced by personal values and experiences. luck cost is an important concept in economics as it fuck be used to predict the feasibility of wiz decision over other. It shows how the decision to increase the input of resources to adept area could dramatically affect the output in another(prenominal) area. A simplified example is a country that solely has two major exportings, rice and pale yellow.

The country has maintained an still balance for many years but climatic changes at present dictate that only one type of groom can be twistn for six months of the year. The country essential collect a decision as to whether they will gather much from growing either wheat or rice. The politics careful that it is significantly more profitable to grow and export rice so a decision is made to grow more rice. The opportunity cost of this decision is that there will be a decrease in the production of wheat resulting in an increase in the price of wheat products. Bibliography: Sloman, J & Norris, K. 1999, Economics, assimilator Hall, Australia.If you want to get a full essay, clubh ouse it on our website: OrderEssay.net

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