What is it called when the government of a country must make a decision between increasing military spending and subsidizing wheat farmers?

What is it called when the government of a country must make a decision between increasing military spending and subsidizing wheat farmers?

The government of a country must make a decision between increasing military spending and subsidizing wheat farmers. This kind of decision is a. Production Possibilities Graph.

What is the opportunity cost of a decision quizlet?

Opportunity Cost is when in making a decision the value of the best alternative is lost. e.g. choosing electricity over gas, the opportunity cost is what you’ve lost from not picking gas. Firms take decision about what economic activity they want to be involved in.

What is opportunity cost and give some examples?

When economists refer to the “opportunity cost” of a resource, they mean the value of the next-highest-valued alternative use of that resource. If, for example, you spend time and money going to a movie, you cannot spend that time at home reading a book, and you can’t spend the money on something else.

What is opportunity cost Explain with examples?

Opportunity cost is the profit lost when one alternative is selected over another. The concept is useful simply as a reminder to examine all reasonable alternatives before making a decision. For example, you have $1,000,000 and choose to invest it in a product line that will generate a return of 5%.

What is trade-off in life?

A trade-off exists when an increase in one life history trait (improving fitness) is coupled to a decrease in another life history trait (reducing fitness), so that the fitness benefit through increasing trait 1 is balanced against a fitness cost through decreasing trait 2 (Figure 2A).

Why is decision-making important in economics?

In reality, economics is vitally important subject because it is the study of making choices. More specifically, it is the study and practice of making choices in a world of limited resources (scarcity). Economic decisions require that you take many variables into consideration when coming to a conclusion.

How do we decide to take economic decisions?

Rational, thoughtful decision making follows a seven-step process that you may be following now, at least sub-consciously:

1. Identify your goal.
2. Collect relevant information.
3. Identify the alternatives and consequences.
4. Review the evidence.
5. Make your economic decision.
6. Implement your decision.
7. Review your decision.

Who answers the 3 basic questions in socialism?

In a Centrally planned economy, also known as a command economy, the central government controls the factors of production and answers the three basic economic questions for all of society. Two systems often mentioned when centrally planned economies are discussed are socialism and communism.

Who answers the three basic questions in socialism?

What are five types of economic systems? Who answer the Three Basic Questions in Capitalism? Who answer the Three Basic Questions in Socialism? The government only answers basic wants.