The idea behind opportunity cost is that the cost of one item is the lost opportunity to do or consume

something else. In short, opportunity cost is the value of the next best alternative. For Alphonso, the

opportunity cost of a burger is the four bus tickets he would have to give up. He would decide whether or not to

choose the burger depending on whether the value of the burger exceeds the value of the forgone

alternative—in this case, bus tickets. Since people must choose, they inevitably face tradeoffs in which they

have to give up things they desire to obtain other things they desire more.

LINK IT UP

View this website (http://openstax.org/l/linestanding) for an example of opportunity cost—paying someone else

to wait in line for you.
30 2 • Choice in a World of Scarcity

A fundamental principle of economics is that every choice has an opportunity cost. If you sleep through your
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