Multiple Choice
Other things equal, which of the following best explains why scarcity forces individuals to make choices?
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0. Basic Principles of Economics
Scarcity and Choice
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Which of the following best describes an opportunity cost?
A
A chance
B
A trade-off
C
A win-win
D
A loss
Verified step by step guidance1
Understand the concept of opportunity cost: it refers to the value of the next best alternative that must be given up when making a choice.
Recognize that opportunity cost involves a trade-off because choosing one option means sacrificing another.
Evaluate each option given in the problem to see which aligns with the idea of giving up something to gain something else.
Identify that 'A trade-off' best captures the essence of opportunity cost, as it implies a choice between alternatives with associated sacrifices.
Conclude that opportunity cost is not simply a chance, a win-win, or a loss, but specifically the trade-off involved in decision-making.
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