TOPIC: Opportunity Cost

Hello! I am studying since a couple of weeks on the PMBOK and PMP Exam Prep from Rita Mulcahy.

In her book on page 110 there is a small chapter about Opportunity cost.

There is an example:

Question: You have two projects to choose from: Project A with a NPB of $45k
or project B with a NPV of $85k. What is the opportunity cpsz pg slecting project
B?

My thought was:
45k - 85k = 40K

The Anser in Ritas book says: 45k

Can you help me to understand that?

Thanks, René!

Sorry there was a little typo:
Project A with a NPV of $45K (not NPB)

René,

Please watch Episode E07.05 Advanced Cost Theory where we explain this.

But let me ask the question in another way: You have an apple and an orange. You eat the orange. What did you not eat (what is your lost "eating opportunity")?

No subtraction needed.

Hi Cornelius!
Great example! Thanks a lot for this! At the moment I am on episode 4.06 and on Ritas book in chapter 4. But I was now listening to your episode E07.05 and after listening to your example with the chairs as well as the example with the apple and orange I am completely clear!!! Thanks a lot!

My aim is to finish your prepcast and Ritas book within the next 5-6 weeks. Then I would like to repeat 1 more time and spend some weeks on your brand new 10weeks self-study coaching course.
I then want to become a PMP latest in december

Nice regards and all the best, René!