Opportunity cost is the cost of participating in the opportunity.

The time value of money is how much your time is worth in money.

In the amount of time you spent waiting for an answer, you could've done something to make a bigger profit.

>>1223767

Opportunity cost is the what it cost you to invest in Option A, when you could have invested into option B

It's the money lost by investing. For example: you could invest in stock A or B. You choose A, and spend all your money on shares of it. Stock B suddenly skyrockets, tripling in value. By taking opportunity A, you lost the profits of B

>>1223775
Kek

You are presented with the option to buy an apple, a banana or an orange. You want all three but because you have limited means, you have to make a choice between the alternatives. You decide that since you can only get one you will get the apple because it's your favourite. At that moment you suffer an opportunity cost because in order to buy your favourite you had to GIVE UP buying a banana. your SECOND favourite fruit.

Therefore Whenever you make a CHOICE you are faced with an opportunity cost. The best alternative forgone. The thing you had to give up in order to get what you wanted.

It's an implicit cost. It doesn't show up on your bank statement like the cost of the apple. Its an implicit cost because it must be considered that you MISSED OUT on the utility gained by eating the banana and the orange. The total economic cost of buying the apple isn't just what you paid for the apple but also what you didn't gain by buying the apple.
The time value of money concept is the idea that a dollar is worth more today than tomorrow. If you were to receive a dollar today or in 5 years it would be logical to receive it today because you can invest it today and grow it so that in 5 years time you would have more than if you have received it in 5 years. Hence, the earlier that you receive money the better because you can put it to work earlier.