Question

Opportunity costs are _____.

- the costs incurred by a firm to preserve its market share
- benefits gained as a result of accepting a particular project
- the costs of pursuing a specific project
- benefits lost due to taking on a particular project

Answer 1

- benefits lost due to taking on a particular project

Step-by-step explanation:

Opportunity costs are also known as the real cost, or the cost of the alternative forgone. Due to the limited resources, a company has to select what project to embark on and what project to leave undone. The opportunity cost is not the benefit gained as a result of accepting a particular project but that lost as a result of the acceptance.

Therefore the last option - benefits lost due to taking on a particular project is right.