Regarding the opportunity cost of the enterprise, what is the cost of opportunity cost

Opportunity cost refers to the opportunity for a business to give up another business activity in order to engage in another business activity, or another type of income when a certain resource is used to obtain a certain income. The income to be obtained from another business activity or another income is the opportunity cost of the business activity being engaged. Through the analysis of opportunity cost, enterprises are required to correctly choose business projects in operation, based on the fact that the actual benefits must be greater than the opportunity costs, so that the limited resources can be optimally allocated.

Extended Materials: 1. Covered Content.

1. The opportunity cost of using other people's resources, that is, the monetary price paid to the resource owner, is called the explicit cost.

2. The cost of giving up the greatest return from other possibilities because of the use of one's own resources is also known as the hidden cost.

2. Prerequisites.

The prerequisites for economic analysis using the concept of opportunity cost are:

1. Resources are scarce.

2. Resources have multiple uses.

3. Resources have been fully utilized.

4. Resources can flow freely.

Features: Opportunities are optional items.

Opportunity cost refers to an opportunity that must be an item that is selectable to the decision-maker, and an item that is not optional to the decision-maker is not an opportunity for the decision-maker. For example, if a farmer can only raise pigs and chickens, then raising cattle will not be an opportunity for a farmer.

Opportunity cost is a benefit.

The project with the highest benefit among the abandoned opportunities is the opportunity cost, that is, the opportunity cost is not the sum of the benefits of the abandoned project. For example, if a farmer can only choose between raising pigs, chickens and cattle, the opportunity cost of raising pigs and chickens is cattle raising, and the opportunity cost of raising cattle is only pig raising.

Opportunity cost vs. resource scarcity.

Choosing one thing in a world of scarcity means giving up something else. The opportunity cost of a choice, i.e., the value of the goods or services that are abandoned. Opportunity cost refers to the maximum possible benefit that can be obtained when a certain resource is used for the production of a certain product under the condition of limited resources.

The law of increments. The law of increasing opportunity cost refers to the increasing opportunity cost generated by each additional unit of the output of a product under the given economic resources and production technology conditions, that is, the output of more other products should be abandoned.

Limited resources and incomplete substitution between factors are the reasons for the increasing trend of opportunity costs: on the one hand, due to limited resources, with the increase of the output of a product, the economic resources used to produce other economic resources are gradually reduced, resulting in the relative scarcity of the economic resources, ** increase, in the case of the same output of other products abandoned, the maximum benefit given up is the increase of opportunity cost; On the other hand, due to the law of diminishing marginal technology substitution rate, that is, under the premise of maintaining the same output, when the input of one factor of production increases, the quantity of another factor of production that can be replaced by each unit of this factor of production decreases, in other words, the opportunity cost increases. This can also be used to explain why the production possibility curve is concave to the origin (sometimes referred to as "convexity").

I am assuming here that SMEs are those whose main business is manufacturing.

The foundation of small and medium-sized enterprises is survival, which means that the products of enterprises are not fundamentally different from those of competitors. Energy and financial resources are mainly focused on sales, and if you want to innovate, then you are faced with a reduction in sales, labor and material costs. Naturally, the fundamentals of the enterprise have been shaken in the short term.

In fact, the main risk is whether the company can resist the cash flow caused by innovation before innovation differentiates the company's products from competitors.

and temporary shortages of sales. This is the opportunity cost of innovation for SMEs.

<> "Opportunity Cost. Daily financial literacy.

Let's say that Orange now earns 100,000 yuan a month, and can earn 1.2 million yuan a year, and then wants to study for a full-time MBA with a tuition fee of 100,000 yuan for 2 years. How much does it cost me? A:

The explicit cost tuition fee is 100,000 yuan, and the implicit cost - opportunity cost is 2.4 million yuan for two years.

We make choices every day, everyone's time and money are limited, and we usually have to give up something else in order to get something.

What we give up (the greatest value) is the price of the choices we make, which is the opportunity cost.

Another chestnut].

If oranges can have a stable annual income of 6% per year, then every cent of oranges that is not used to earn this 6% income has a 6% opportunity cost.

If you make other investments, as long as the return is less than 6%, you will lose money.

If you take 100 yuan and enjoy it, the cost is not 100, but 106....

Opportunity cost] refers to the opportunity cost when faced with the choice of what to do with the resource in the case of limited resources. The opportunity cost is not the actual cost of paying for the scrap, but a lost gain.

All: All options come at an opportunity cost.

Max: The opportunity cost is the maximum cost of the current selection.

Inevitable: Opportunity cost is an option that can be chosen by the inevitable stupidity.

<> "What is the cost of opportunity cost?

What does opportunity cost mean?

Opportunity cost is simply when you choose one option and give up the benefits of another, the other.

The benefit is the opportunity cost, for a popular example, you can't choose to raise other poultry, the opportunity cost of raising pigs.

It is to give up the benefits of raising chickens. Let's say you can get a dollar for raising pigs.

Raising chickens can get b yuan, then the opportunity cost of raising pigs is.

b, similarly, the opportunity cost of raising chickens is $a.

Opportunity cost is related to the scarcity of resources. Because the resources are.

Scarcity, we make any choice has a cost. Allow.

Whatever choice comes at a price.

Opportunity cost is defined as a choice or decision.

- the resource must be abandoned when it is used for a certain purpose.

The value of other best uses.

Take a popular example: a friend gave you a card worth 60 yuan.

Movie tickets, if you decide to take a movie ticket to watch the electric Hu Tan movie, then you.

The cost paid is the cost of time and the cost of movie tickets, even if.

This ticket was given to you by someone else, but it is still worth 60 yuan, and you can sell it for 60 yuan. So when you choose to take the movie.

ticket to the movie, at this time you give up the opportunity cost, that is, your time cost + 60 yuan ticket price.

One more extension. If a friend sends a real-name card.

The movie ticket is 60 yuan, so how to calculate the opportunity cost. This kind of affection.

In addition, there are many in life, such as mileage redemption tickets, only.

For the use of redeemers. This situation is due to the limitation of use.

objects, so you can't sell, so the opportunity cost only.

The cost of your time.

Assuming that the movie ticket is 60 yuan, the scalper price has been sold to 90

What about the meta? Is the opportunity cost still $60 and the time used?

Because the opportunity cost is the current maximum of the resources you use.

Great value. The ticket price has been fried to 90 yuan, so at this time.

If you continue to choose to watch movies, the opportunity cost is 90 yuan yellow.

Cattle price and the cost of your time.

Three costs. In microeconomics, there are three very core concepts:

Sunk Cost (OST).

Marginal cost (OST).

Opportunity Cost (OST).

To sum up, these three costs are reflected in our relationship.

For the following three simple words:

Sunk cost determines how people look at the past, marginal cost determines how people treat the present, and opportunity cost determines how people face the future.

Sunk costs vs. the past.

Sunk cost, in my understanding, is the investment of the past, and it will no longer have a positive effect on the future.

In economics, it is known as sunk costs.

Marginal cost vs. now.

The marginal cost is the investment you have to pay for each additional unit of return.

Margin, is the meaning of increment.

Opportunity cost and the future.

Opportunity cost is when you choose an opportunity and give it up.

The best value that other opportunities can bring you.