The potential benefit that is given up when one alternative is selected over another is called a(n) _________ cost.

Question

BlackTom AI · Accepted Answer

When examining the terminology used in cost concepts, it’s important to match the definition to the word.
Option 1: 'opportunity' — This is the correct term. An opportunity cost is the benefit or value you give up by choosing one alternative over another, i.e., the cost of the next best alternative foregone.
Option 2: 'avoidable' — This term describes costs that could be eliminated if a decision changes, but it does not capture the idea of what you sacrifice by choosing one option over another. It’s not the standard label for the concept described in the question.
Option 3: 'relevant' — In cost accounting, relevant costs are the ones that will be affected by a decision. While related to decision making, this word does not denote the specific concept of what is forgone by selecting one option instead of another.
Option 4: 'differential' — Differential (or incremental) costs refer to the difference in costs between options, not the value of the foregone alternative itself. It’s a related idea in analysis but not the term for the benefit sacrificed when choosing one path over another.
In summary, option 1 aligns with the standard definition of opportunity cost, while options 2 through 4 describe different concepts that don’t capture the exact notion of what is given up when one alternative is selected over another.

SU25_ACT_513_2601 WK 7 Pre-Class Check: Strategic Decisions with Cost Data

The potential benefit that is given up when one alternative is selected over another is called a(n) _________ cost.

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SU25_ACT_513_2601 WK 7 Pre-Class Check: Strategic Decisions with Cost Data

The potential benefit that is given up when one alternative is selected over another is called a(n) _________ cost.

查看解析

登录即可查看完整答案

类似问题

What distinguishes short-run opportunity cost from long-run opportunity cost?

Based on the production possibilities curve for books and pencils shown, what is the opportunity cost of producing a book?

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According to the following graph, the opportunity cost of moving from point C to point B is ___.

What is the most likely outcome of an economic policy based on the "Broken Window Fallacy"?

The "Broken Window Fallacy" argues that destruction can actually help the economy.

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The following PPF best represents _; in this case, _.