Which of the following is an example of an opportunity cost?
A) Renting an apartment near school
B) Taking a class instead of working at your part-time job
C) Setting aside money for paying income tax
D) Purchasing automobile insurance

Question

Quizplus · Accepted Answer

Opportunity cost refers to the value of the thing that is given up in order to attain or achieve something else. In this case, taking a class instead of working at a part-time job means giving up the income that comes with the job. Therefore, the opportunity cost of taking the class is the income that could have been earned by working at the job. A, C, and D are expenses, but they are not direct examples of opportunity cost.

Which of the Following Is an Example of an Opportunity