Friday, March 03, 2006

Opportunity Cost

Intriguing Concept:
Although the example cited here is about real estate, it applies to many things.

Opportunity cost is a term used in economics to mean the cost of something in terms of an opportunity forgone (and the benefits that could be received from that opportunity), or the most valuable forgone alternative. For example, if a city decides to build a hospital on vacant land that it owns, the opportunity cost is some other thing that might have been done with the land and construction funds instead. In building the hospital, the city has forgone the opportunity to build a sporting center on that land, or a parking lot, or the ability to sell the land to reduce the city's debt, and so on.

Real Estate on Translationfound:
Arab real estate fond at Unicredito's HRE | Opportunity Cost | UniCredito's HRE | Allodial unique to U.S. real estate law | REITS vs offene Fonds | Seneca on foreclosure

Gisela Strauss, Translator
München | Munich

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Gisela Strauss

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