define the term opportunity cost
Business school applications have surged this year, though this partly reflects the economic downturn, which reduces the opportunity cost of taking time out from a career to study. The opportunity cost of holding money rather than buying bonds or some other interest-bearing asset is the nominal interest that would otherwise be earned. An opportunity cost is the cost of not being able to do other things with time and resources because of doing the chosen activity.
Opportunity cost is the value of something when a particular course of action is chosen. Simply put, opportunity cost is what you must forgo in order to get something. The benefit or value that was given up can refer to decisions in your personal life, in a company, in the economy, in the environment, or on a governmental level.