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

This translates to approximately $625,000 in additional lifetime earnings (using a conservative 3% discount rate and accounting for the opportunity cost of being out of the workforce during college years). —Chris Muller, Forbes, 29 Dec. 2024

Although using Melton’s salary in a trade on this scale comes with opportunity cost, the Warriors added a valuable piece while holding onto their best trade assets. —Danny Emerman, The Mercury News, 15 Dec. 2024

But there is always an opportunity cost to waiting in the NBA. —Jovan Buha, The Athletic, 16 July 2024

There’s also the opportunity cost of filling up on super-processed stuff. —Erica Sloan, SELF, 18 Dec. 2024

Word History

First Known Use

1894, in the meaning defined above

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