How do I calculate opportunity cost in Excel?

Opportunity Cost = Total Revenue – Economic Profit

1. First Order = INR 7500 – [(16 * 100) + 1800]
2. First Order = INR (7500 – 3400)
3. First Order = INR 4100.

How do you calculate opportunity cost in accounting?

Calculating opportunity cost Remember that opportunity cost is calculated by subtracting the rate of return on your chosen option from the rate of return on the best foregone alternative, rather than from the sum of the rate of return of all the possible foregone alternatives.

How is opportunity cost calculated in AP Micro?

Add the value of the next best alternatives (the opportunities that would have been chosen had the choice not been available) and you have the total opportunity cost. If you miss work to go to a movie, your opportunity cost is the money you would have earned if you went to work plus the money spent to go to the movie.

How do you calculate comparative cost advantage?

To calculate comparative advantage, find the opportunity cost of producing one barrel of oil in both countries. The country with the lowest opportunity cost has the comparative advantage. With the same labor time, Canada can produce either 20 barrels of oil or 40 tons of lumber.

What does the opportunity cost means explain with a numerical example?

Opportunity cost is the next best alternative foregone in choosing the best one. Suppose an economy produces only two goods X and Y. if the economy decides to produce 2X, it has to cut down production of Y by 2 units because resources are limited. in this case opportunity cost of producing one more unit of X is 2Y.

What is opportunity cost in Class 12?

Opportunity cost of an activity (or good) is equal to the value of the next best alternative foregone. It is the cost of foregone alternative.

What is opportunity cost with Example Class 12?

In other words, the cost of enjoying more of one good in terms of sacrificing the benefit of another good is termed as opportunity cost of the additional unit of the good. Example: We have Rs 15,000 with two choices a) to invest in the shares of a company XYZ or b) to make a fixed deposit which gives interest 9\%.