An opportunity cost is simply an economic concept that states that when an individual makes a choice, they are foregoing the second best alternative of that choice. In other words, by making a choice you are always giving something up. This can be measured in monetary figures or in opportunities, such as what could have been done with the time and resources.
In this example of a student choosing to pursue a college education, they are certainly incurring an opportunity cost. Let's assume a student pursues a four-year bachelor's program at a state university that costs $8,000 per year to attend. That means the total monetary cost is around $32,000 to obtain the degree. Within these four years, the student has foregone many alternative choices, such as to enter the work force or military where they would be earning a salary.
Within these four years, the student perhaps has also foregone the opportunity to learn specific skills in the workforce or military that could prove to fetch higher salaries in the future; for example, a skilled trade. For the sake of argument, let's say the student could have earned a salary of $30,000 a year instead. If the student forewent the four years working at that salary, then they would have also incurred the opportunity cost of $120,000 in wages they could have earned in those four years instead of the $32,000 they spent on the education.
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