Respond two peers dicussion post.
Intial prompt:
Every decision has an Opportunity Cost due to the nature of scarcity, there is always a better alternative not chosen, therefore, there is always an opportunity cost. The opportunity cost of an alternative is what you give up to pursue it (Froeb, McCann,Shor & Ward, 2016). When you go to a Maroon 5 concert, you give up $100 of benefits you would have received if you had gone to a Beyonc concert. Also, you would also avoid $80 of cost for the Beyonc concert. According to the definition below, the opportunity cost of seeing Maroon 5 concert is $100 – $80 = $20. Please delve into the statement there are always opportunity costs. How can an individual make the best decision? Is there a best decision? Would one miss an opportunity not attending one of the concerts? Include a minimum of one reference.
Peer 1: Opportunity cost is often a justification to make irrational decisions. The truth is often opportunity cost is more complex then it may be at face value, because the dollars and cents don’t necessarily tell the whole story. Take this imaginary scenario – $100 in benefits if you attend a Beyonce concert (which makes less then zero sense, but lets imagine). The question wants us to believe the opportunity cost of seeing Maroon 5 is $20 instead of Beyonce, but that’s a pointless metric. Maroon 5 and Beyonce are not the same thing. Once a person has tickets in hand, what may have been is no longer necessarily relevant, and using concert attendance as opportunity cost example is a poor use of the mechanic for that reason.Example:, If I bought the tickets for $20 and I can sell them now for $100, the opportunity cost to attend the performance is NOT $80, though the metric may suggest that’s the case. There are unseen costs. What is my time worth listing these for sale? What is my sanity worth dealing with idiots when I’m trying to sell them? What is the potential for me getting robbed or scammed when I make the sale? The unseen costs are what really tell the story here, and determine the worth of a trade, or endeavor. It is almost never the opportunity cost, because it’s simply the least relevant metric. The best decision to be made is the best decision for you. The opportunity cost of an alternative is what you give up to pursue it (Froeb, McCann,Shor & Ward, 2016) doesn’t necessarily just speak to dollars. Perhaps there are nonmonetary costs that are given up in lieu of monetary costs – perhaps this is the final show of a group, and by not attending the opportunity cost lost is the chance to ever see them perform live. Opportunity cost is very often opportunity fallacy, because it’s easy to let it influence behavior even if it shouldn’t be a driving factor in decision making.
Peer 2I:
For this week’s discussion we are discussing operational costs. Opportunity cost is the loss of potential gain from other alternatives when one alternative is chosen. (Dictionary) just like when you have to make a decision is very important to wait all options. The same is to be said when it comes down to business ventures. When coming to business ventures is very important to look at both the cost and the benefits of each option. You have to way your options against other options. By using the opportunity cost method you’re able to determine if the business venture that you are considering is going to be a profitable decision or not. For the example the way and individual can make the best decision is by considering opportunity cost. Yes there is what would be considered the right or the best decision. Due to the fact that going to the concert is less than the cost then the amount for the ticket means that you can go to one and not feel that you made it bad profitable decision. Even though there’s always a better choice if you look at each opportunity from a profitable standpoint it makes it easier to cancel out other options that won’t in the end yield any profits or benefits. Like the example that was given for the discussion even though you’re giving up $100 in benefits you’re really only losing out on $20. And even though any amounts of losing or leaving behind is bad it is not as high as either of the concerts that you would be attending. This is why it makes it okay for you to take the risk and go to at least one. But you have to be careful because even with using this method you can run into a point where you end up looking at benefits in the cost in different forms. This can sometimes make a company or individual pick an opportunity that really isn’t correct but looking at the data from just one and I comparing it to all Willow make them choose the wrong option.
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