opportunity cost

American  

[op-er-too-ni-tee kawst] / ˌɒp ərˈtu nɪ ti ˌkɔst /

noun

Economics.

1. the money or other benefits lost when pursuing a particular course of action instead of a mutually-exclusive alternative.

   The company cannot afford the opportunity cost attached to policy decisions made by the current CEO.

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opportunity cost British  

noun

1. economics the benefit that could have been gained from an alternative use of the same resource

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Etymology

Origin of opportunity cost

First recorded in 1910–15

Compare meaning

How does opportunity-cost compare to similar and commonly confused words? Explore the most common comparisons:

• trade-off vs. opportunity cost

Example Sentences

With yield premiums narrow in the corporate market, the opportunity cost of being in Treasuries is reduced.

From Barron's • Jun. 26, 2026

A lengthy calculation is not worth the opportunity cost if the chance of success is extremely low.

From Slate • Jun. 22, 2026

Over any longer period, the opportunity cost of holding it is likely to exceed that of poor timing in the stock market.

From The Wall Street Journal • May 28, 2026

Ordinarily, I would not recommend taking money from your investment accounts as you’re paying tax on the withdrawals and getting hit by the lost opportunity cost of future returns.

From MarketWatch • Apr. 6, 2026

But the opportunity cost of tying up $160,000 with the IRS, along with potential capital-gains taxes from liquidating investments, likely approaches the cost of simply taking the RMD.

From MarketWatch • Mar. 23, 2026