Mr. Krishan works as support executive in a BPO at a salary of Rs 75,000 per month. He got a job offer from another company X at a salary of Rs 90,000 per month and one more from company Y at a salary of Rs 1,00,000. What is his opportunity cost of working as support executive in the BPO?

1,00,000

The correct answer is Option 2: 1,00,000

Opportunity cost is the value of the next best alternative that must be forgone when making a choice. It represents the benefits you miss out on by choosing one option over another. This concept is fundamental in economics and decision-making, as it highlights the trade-offs involved in allocating resources like time, money, or effort.

The opportunity cost of working as a support executive in the BPO is the value of the next best alternative forgone. In this case, Mr. Krishan has two offers:

1. ₹90,000 from Company X
2. ₹1,00,000 from Company Y

The highest salary offer is ₹1,00,000 from Company Y. Therefore, the next best alternative to working at the BPO is the ₹1,00,000 salary from Company Y.