Management is considering whether to purchase a new model X machine costing $523,000 or a new model Y machine costing $482,000. The new machine will replace a machine that was purchased 7 years ago for $518,000. The old machine broke down last week. Unfortunately, the old machine cannot be repaired.

Management has decided to buy the new model Y machine. It has less capacity than the new model X machine, but its capacity is sufficient. Management also considered, but rejected, the alternative of simply dropping the product line. If that were done, instead of investing $482,000 in the new machine Y, the money could be invested in a project that would return a total of $497,000.

In making the decision to invest in the model Y machine, the opportunity cost was:

A.$482,000

B.$518,000

C.$523,000

D.$497,000