When a rational person makes a choice, the concept of opportunity cost
Right Answer is: B
• The opportunity cost of a factor of production is what has to be paid to retain in its present use.
• The opportunity cost in general refers to the value of what you have to give up in order to choose a particular option.
• It refers to value forgone.
• When a rational person makes a choice, the concept of opportunity cost enters, thus opportunity cost is defined as the benefit lost in terms of the next best alternative foregone when a choice is made.