Matthew is a computer analyst who earned $200,000 in 2016. at the beginning of 2017, matthew wanted to pursue a new career so he quit his job and opened a bakery. in his first year, he made total revenue of $50,000. the information on the right gives details of matthew's first year in the bakery business. what is matthew's opportunity cost of production?

Matthew's opportunity cost of production is $200000.

Explanation:

An opportunity cost is the earning from the best alternative available.

Matthew was working as a computer analyst where his salary was $200000 which is his best alternative this means that the opportunity cost of the opening bakery for Mathew is $200000.

Therefore, Matthew's opportunity cost of production is $200000.

urban company reports the following information regarding its production cost: units produced 37,000 units direct labor $ 30 per unit direct materials $ 35 per unit variable overhead $ 237,000 in total fixed overhead $ 127,000 in total