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The best and fully defined concept of opportunity cost is: The value of the best alternative that is given up in order to do or get something. This means that when you make a choice, the opportunity cost is the value of the next best alternative that you forego by choosing that option.
Let's break it down with an example:
Imagine you have [tex]$10 and you are debating between buying a movie ticket for $[/tex]10 or buying a book for $10. If you choose to buy the movie ticket, the opportunity cost would be the value of the book you could have purchased instead. In this case, the opportunity cost is the value of the best alternative foregone, which is the book.
Therefore, the opportunity cost is not the monetary cost of the materials used, the difference between marginal cost and benefit, or the value of all things given up when using a resource. It specifically refers to the value of the next best alternative that is sacrificed when making a decision.
I hope this explanation helps clarify the concept of opportunity cost for you! Let me know if you have any more questions.
