Multiple Choice
Economic factors in decision making fall under the category of:
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0. Basic Principles of Economics
Factors of Production
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Which of the following addresses the economic question of 'how to produce'?
A
Determining which goods and services should be produced
B
Deciding whether to use labor-intensive or capital-intensive methods
C
Establishing the price at which goods and services will be sold
D
Choosing who will consume the goods and services produced
Verified step by step guidance1
Understand the three fundamental economic questions: 'What to produce?', 'How to produce?', and 'For whom to produce?'.
Recognize that 'What to produce?' involves deciding which goods and services should be made.
Know that 'How to produce?' concerns the methods and resources used in production, such as choosing between labor-intensive or capital-intensive techniques.
Identify that 'For whom to produce?' deals with the distribution of goods and services among consumers.
Conclude that the question 'How to produce?' is addressed by deciding whether to use labor-intensive or capital-intensive methods.
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