What is the relationship between the cost of lack and the opportunity?

The cost of deficiency and opportunity is two interconnected concepts in economics, as companies often have to choose between rare resources. In most cases, economic resources are not always completely available in unlimited numbers, so companies must choose which sources to use during production. The opportunity costs are an alternative given up when choosing one source over another. These two concepts have a direct connection, for example, companies can use a lower but more affordable source for the production of goods. Individuals and companies have to decide what items they use to meet needs and want all parties in the economy. The deficiency can force the elections to start exhausting. For example, the timber manufacturer may need to choose which wood is harvested because some types become available.

The cost of the opportunity carries the classic definition Selecting another best alternative. For example, a furniture manufacturer might want to use mAhagon lumber to create a bedroom. Due to the lack of local lumber manufacturers - ie lack of sufficient mahogany wood for sale - must use cherry wood instead. The occasion of the opportunity is therefore the mahogany wood, which the furniture manufacturer demanded in the first place. Lack costs and opportunities can usually be the largest drivers in the elections made due to the company's inability to produce certain goods in the long term.

both are also present in the life of individuals in the economy of the free market. For example, a consumer might want a brand new personal computer with a specific operating system and software components. The only problem, however, is that this computer is not widely available, which is economically rare. Konsumer must find another best alternative that represents an economic choice and occasional costs. An alternative personal computer will be a fungoWell, but it's not the first consumer choice.

Standard economic theory states that every consumer is a rational individual. Therefore, the concept of lack of lack and opportunity dictates that individuals and companies will choose another best economic option if necessary. For example, the company does not have to choose an alternative economic source if the required source is rare. The company could simply give up production on a particular product. There are no opportunities in this possibility because the company has avoided another best alternative.