Which of the following best explains how your daily choices can affect the global economy?

• A. Individual consumption decisions influence demand for goods and services, which can impact production and trade worldwide.
• B. Personal choices have no effect on the global economy because only governments and large corporations matter.
• C. Global economic changes are determined solely by natural resources and not by individual actions.
• D. Daily choices only affect local markets and do not have any impact beyond your community.

Answer: (A)

Verified step by step guidance

1. Understand the concept of individual consumption decisions: These are the choices made by consumers about what goods and services to buy on a daily basis.
2. Recognize that individual consumption decisions collectively influence the overall demand for goods and services in the economy.
3. Know that changes in demand affect production levels, as producers respond to consumer preferences by adjusting output.
4. Realize that production adjustments can influence trade patterns, since increased or decreased demand for certain goods affects imports and exports globally.
5. Conclude that because individual choices aggregate to affect demand, production, and trade, they can indeed impact the global economy, making the first option the best explanation.