Banking Term: Opportunity Cost

Find important banking term that is useful in upcoming banking exam.

Mar 2, 2015 14:08 IST

Opportunity Cost is the value of the next best use (or opportunity) for an economic good or the value of the sacrificed alternative.

For Instance

The opportunity cost of going to college is the money you would have earned if you worked instead. On the one hand, you lose four years of salary while getting your degree; on the other hand, you hope to earn more during your career, thanks to your education, to offset the lost wages.

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