opportunity costs

What you sacrifice

Opportunity cost is what you give up by choosing one option over another.

If you spend Saturday working, the opportunity cost is the leisure you forfeited.

The concept is central to economics: every choice has a cost measured not in money spent but in alternatives sacrificed.

The opportunity cost of college includes four years of potential wages.

economics

trade-offs

Sacrifices for gains

scarcityInsufficiency of something needed
resource allocationAssigning available means strategically
decision-makingProcess of choosing actions

alternatives · comparative advantage · budget constraint · capital allocation · investment analysis · microeconomics · efficiency · consumer behavior · incentives · rational choice

sacrifice

give up

Stop attempting something

relinquishVoluntarily give up control
forgoDeliberately do without
renounceFormally give up

surrender · concession · compromise · prioritization · allocation · exchange · substitution · balancing · quid pro quo

regret

foregone

Already certain beforehand

missedFailed to reach
lostUnable to navigate
unrealizedNot made actual

squandered · overlooked · bypassed · neglected · what-if · hindsight · second-guessing · wistful · rueful · lament

Categories

cost accountingoverhead, direct labor, break-even point, contribution margin, budget variance
business costsadministrative fees, direct labor, raw materials, labor, materials
lawsuit damageslost wages, lost income, lost profits, medical bills, property damage

Opposites

type of cost/expense

opportunity costsout-of-pocket costs

Expenses you pay yourself

direct costs · sunk costs · hard costs · operating expenses

economic reasoning framework

opportunity costsreturns

Profits from investments

profits · rewards · windfalls · proceeds

Family

opportunity, opportunities, opportune, opportunely, opportunism, opportunist, opportunistic, opportunistically, inopportune

Familiarity: Top 200,000
Profile: Used worldwide · Timeless · Abstract · Rated G