KQuestion 23 of 50 Opportunity costs O Result in a cash outl

KQuestion 23 (of 50) Opportunity costs O Result in a cash outlay O Unless they are zero are always relevant for decision making. O Can sometimes be deductible for U.S. federal income tax purposes. O Are recorded in the accounting records. O Are the result of a completed event or transaction.

Solution

Opportunity costs is the cost of next best alternative foregone. What we are sacrificing to get something is the opportunity cost. For example, interest which could have been earned on the capital which we invest in the business. Interest foregone as a result of investing the capital in the business is the opportuity cost of doing the business. It is not recorded but is considered while making the decisions. Thus, the correct answer is, Unless they are zero are always relevant for decision making. Option 2.