What is the opportunity cost?

A business analyst is helping management determine which solution they should choose. As it happens that the organization can only choose one of the two solutions due to time and resource restrictions. Solution A worth $456,000 to the organization while solution B worth $565,000 to the organization. While solution A costs less, it is less risky and takes less time to complete so management elects to seize Solution A.

What is the opportunity cost?

A. $565,000

B. There is not enough information to know how much the solution will cost the organization.

C. $109,000

D. $456,000

View Answer

Answer: A

Explanation:

The opportunity cost is the total value of the opportunity that can be taken advantage of.