Question

Opportunity cost is an avoidable cost.

• A. True
• B. False

Answer 1

The correct option is B False

Opportunity cost is an avoidable cost- this is a false statement, since opportunity cost cannot be avoided.In an economy, every goods and services has an alternative available. Opportunity cost of production of a commodity refers to the cost which the producer has to sacrifice in terms of the next best alternative which could be produced out of that cost in order to produce every unit of the given commodity. Therefore, to produce every commodity producer has to sacrifice some units of the other commodity.