Question

An entrepreneur decided to leave a job that pays $50,000 a year to start a business. These lost wages would be considered ______________ . g

Answer 1

These lost wages would be considered as opportunity cost

Step-by-step explanation:

The lost wages would be considered as opportunity cost .

Opportunity cost is the value of the next best alternative forgone in favor of a decision. The decision of the entrepreneur to start a business of his own would mean forgoing the wages from his paid employment.

Hence, the lost wages of $50,000 becomes an opportunity cost to the decision.

These lost wages would be considered as opportunity cost