What is the relationship between changes in opportunity costs and changes in behavior?

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

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The relationship between these two variables is an inverse relationship.  That is, as one goes up, the other goes down.  As the opportunity cost of a given behavior changes, the frequency of that behavior changes in the opposite direction.

Opportunity cost is what I give up in order to do a certain action.  If the opportunity cost goes up, I have to give up more to do that action and I will become less likely to do it.  If the opportunity cost goes down, I will be more likely to do that action.  Thus, the relationship is inverse.

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