Mr Raman works as production manager at a salary of Rs. 80,000 per month in company A. He got a job offer company B at a salary of Rs 90,000 per month and another job offer from company C at a salary of Rs. 95000 per month. What is his opportunity cost of working as production manager in company A.

Mr Raman works as production manager at a salary of Rs. 80,000 per mon

1.	Mr Raman works as production manager at a salary of Rs. 80,000 per month in company A. He got a job offer company B at a salary of Rs 90,000 per month and another job offer from company C at a salary of Rs. 95000 per month. What is his opportunity cost of working as production manager in company A.
Answer» Solution :In the above example, the NEXT best use of Raman's services is in COMPANY C which has given him an offer of Rs. 95000 per month. THEREFORE, opportunity COST of Mr. Raman for working as production manager in company A is Rs. 95000.