Which of the following best describes the opportunity cost for a farmer who chooses to grow several crops on a farm?

• A. The number of hours the farmer works each day.
• B. The amount of money spent on seeds and fertilizers.
• C. The value of the next best alternative use of the land that is forgone.
• D. The total revenue earned from selling all the crops.

Answer: (C)

Verified step by step guidance

1. Understand the concept of opportunity cost: it is the value of the next best alternative that is given up when a choice is made.
2. Identify the decision the farmer is making: choosing to grow several crops on the farm, which means using the land for those crops instead of something else.
3. Recognize that opportunity cost relates to what the land could have been used for if not for growing these crops, not just the money spent or hours worked.
4. Evaluate each option in the problem: hours worked and money spent are costs but not opportunity costs; total revenue is a result, not a cost; the value of the next best alternative use of the land represents the true opportunity cost.
5. Conclude that the opportunity cost is best described as the value of the next best alternative use of the land that is forgone when the farmer chooses to grow several crops.