A business must decide whether to open a new office in China. If it opens the branch, it will increase its chances of selling a high volume of its products in China. On the other hand, the business will have to spend a lot of money to make the branch operational.

Complete question is;

A business must decide whether to open a new office in China. If it opens the branch, it will increase its chances of selling a high volume of its products in China. On the other hand, the

business will have to spend a lot of money to make the branch operational.

What would be an opportunity cost for the business if it chooses not to open the new branch in China?

A. The business would lose the chance to make more money in China.

B. The business would have to open a new branch in a different country.

C. The business would increase its marginal benefits on each product it makes.

D. The business would be able to use the money it saves on other projects.

Option A: The business would lose the chance to make more money in China.

Step-by-step explanation:

Opportunity cost simply means a forgone alternative. That is the cost forgone when an alternative option is ignored in favour of another one.

Now, we are told that If the company opens the branch, it will increase its chances of selling a high volume of its products in China. This means it will make more money in turn from these sales if it opens a branch in China.

Now, if the company chooses not to open a new branch in China, it means it will lose out on making high volume of sales and subsequently making more money in China. Thus, this is the opportunity cost.

The only option that agrees with this is option A.

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