Opportunity cost concept is very important to the view of costs of
economists. It is defined as the worth or value of a forgone activity or
alternative when another item is chosen. It is a relative cost of one
alternative in terms of the next best alternative. It is a vital economic
concept which finds application a wide range of business decisions. Decision –making
is usually overlooked by opportunity cost. Opportunity costs should often
subjectively estimated by decision-makers.
