The opportunity cost of a factor of production is

Options

A. what it is earning in its present use.
B. what it can earn in the long period.
C. what has to be paid to retain it in its present use.
D. what it can earn in some other use

Answer

D

Explanation

The opportunity cost of a choice is the value of the best alternative forgone, in a situation in which a choice needs to be made between several mutually exclusive alternatives given limited resources. It is equivalent to what a factor could earn for the firm in alternative uses.