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Opportunity Cost - Definition
Below, you'll find a definition of this investing term...

Definition: An accounting/economics term referring to the value of something given up to pursue something else.

TeenAnalyst Advice: An example of opportunity cost would be going to the movies.  The cost of going to the movie is $9.00 or whatever ridiculous amount of money your movie theater charges.  The opportunity cost would be something else you could have done with that time, such as studying.

Accountants and economists must weight opportunity costs when making decisions.

 

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