economics
opportunity cost
The value of the next best alternative you give up when making a financial decision.
Example
"The opportunity cost of buying a car was the investment returns she could have earned with that money."
💡 Memory Tip
What OPPORTUNITY did you give up? Every choice has an opportunity cost — the next best thing you didn't do.
Etymology
Opportunity (a favorable circumstance) + cost — the cost of missing other opportunities.
Common Misspellings
opportunity costeoportunity costopprotunity costopportunty cost
Related Terms
See Also
trade-offdecision makinginvestment