Opportunity Cost: - The maximum benefit foregone due to choosing one alternative
over another. For example consider the following investment opportunities and
Return. We have BDT 1000 and we have three investment opportunities
i) We can make a bank deposit which can earn 10% return.
ii) We can make investment in share which can gives 15% return.
iii) We can start a business which can earn 17% return.
Now if we choose to invest in share then 17% is the opportunity cost for investing in share.
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