opportunity cost

noun

: the added cost of using resources (as for production or speculative investment) that is the difference between the actual value resulting from such use and that of an alternative (such as another use of the same resources or an investment of equal risk but greater return)

Examples of opportunity cost in a Sentence

Recent Examples on the Web
Examples are automatically compiled from online sources to show current usage. Read More Opinions expressed in the examples do not represent those of Merriam-Webster or its editors. Send us feedback.
Risk isn’t just measured in standard deviation—it’s measured in the opportunity cost of being unprepared. Thierry Brunel, Forbes.com, 15 May 2025 Using this full-cost accounting method is something university administrators would be wise to consider in their decision-making, given the real opportunity costs of faculty time. Joshua M. Pearce, The Conversation, 23 Apr. 2025 The opportunity cost is enormous because packaging and presenting data to consumers in the right way can actually build trust and loyalty. Graham Gardner, Forbes.com, 14 May 2025 With opportunity cost in mind, each dollar spent is thought out more thoroughly. Sam Dogen, CNBC, 6 May 2025 See All Example Sentences for opportunity cost

Word History

First Known Use

1894, in the meaning defined above

Time Traveler
The first known use of opportunity cost was in 1894

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Cite this Entry

“Opportunity cost.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/opportunity%20cost. Accessed 5 Jun. 2025.

Legal Definition

opportunity cost

noun
op·​por·​tu·​ni·​ty cost
: the cost of making an investment that is the difference between the return on one investment and the return on an alternative

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