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sir i want to understand why the following statement is true?
“opportunity cost is represented by the foregone potential benefit from best rejected course of action.”
sir should not it be second best rejected course of action? Because the ‘best’ one would actually have been selected, so what would have been foregone could only be second best.
Your response would be much appreciated!
The statement it true.
For there to be an opportunity cost in the first place then we must be rejected a course of action. It is the best course of action that will have been rejected (assuming of course that it is then worthwhile doing what we are considering).
so are you suggesting that we always make inefficient decisions, by forgoing the best course of action?
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