Question

Imagine that you have won $100 in the state lottery. you have a choice between spending the money on shopping now or putting it away in a savings account for one year. you decide to spend the money now on shopping. thus, you will lose the interest that you could have earned by saving the money. the lost interest is the_____ cost of spending money now.

Answer 1

Answer:

The answer is: opportunity cost

Explanation:

Opportunity cost refers to what you lose because you decided to make a different choice.

For example, if you would have chosen to save the money, you would have probably earned 2 to 3 dollars in interest, but since you chose to spend all the money then you didn't earn 2 to 3 dollars. These 2 to 3 dollars that you didn't earn is the opportunity cost.

Answer 2

Answer: opportunity

Now that you know the answer you can find the definition of oportunity cost in many sites.

It is the earn that you might have but you wont't becasue you make a different decision.