Which of the following best describes what the economic perspective entails?

• A. Making decisions by comparing marginal benefits and marginal costs
• B. Focusing solely on maximizing total output regardless of costs
• C. Assuming resources are unlimited and freely available
• D. Ignoring opportunity costs when making choices

Answer: (A)

Verified step by step guidance

1. Understand that the economic perspective involves how individuals and societies make choices given scarcity.
2. Recognize that scarcity means resources are limited, so choices must consider trade-offs.
3. Identify that the economic perspective focuses on comparing the additional (marginal) benefits and additional (marginal) costs of decisions.
4. Note that maximizing total output regardless of costs ignores the cost side of decisions, which is not consistent with the economic perspective.
5. Remember that ignoring opportunity costs or assuming unlimited resources contradicts fundamental economic principles, as opportunity cost is central to economic decision-making.