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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Opportunity cost
Sir i have some doubts in opportunity cost….
1) if for example i have 2 projects for a machine…if i use it in project 1,will the net benefit of using in project 2 be a opportunity cost?
The net benefit of using the machine in project 2 would be considered an opportunity cost if it is foregone by using the machine in project 1 instead.
As it refers to the value of the next best alternative that is forgone when a particular choice is made, so if the machine is used in project 1, the net benefit that could have been obtained by using it in project 2 is lost, making it an opportunity cost.