Investment Fundamentals

Opportunity Cost

Definition

What is Opportunity Cost?

The value of the best alternative forgone when one choice is made.

Example in practice

Using ₦1 million for land means giving up the return it might have earned in a bond fund.

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The original amount of money invested or lent, excluding later returns.

Money or other resources committed to produce income, growth, or another economic benefit.

An asset or commitment of money made with the expectation of future income, growth, or both.

Anything with economic value that can be owned or controlled.

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