THE OPPORTUNITY COST TREE
Opportunity cost refers to what you have to give up to buy what you want in terms of other goods or services. Everything in this world has opportunity cost and we deal with it every day in our life !
The above image of a tree represents the concept of opportunity cost. The branch of the tree divides itself into two, indicating the two available choices for an individual to choose from. From the left to right side of the tree, the choices are as follows- Studying vs. Watching TV, Cooking at home vs. ordering food online,
Going to a movie vs. saving money, and family time vs. overtime at work. The fruits represent the gains like a good career after studying well, good health after cooking at home, etc.
In simple words, the opportunity cost of watching TV is studying and the gains that you could have gained from it.
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