Eco - 1.2 Economic Choice Today: Opportunity Cost

Choice is deciding between two or more possible alternatives.

• True

• False

Human wants are unlimited but resources are scarce.

• True

• False

Choices that we make are not influenced by incentives or utility.

• True

• False

Grades in schools, wages paid to workers, praise or recognition earned in personal or public life are all examples of incentives.

• True

• False

Utility is the benefit or satisfaction not received from using a good or service.

• True

• False

Economize means to “make decisions according to what you believe is the best combination of costs and benefits.”

• True

• False

The alternative that you avail when you make an economic choice is called a trade-off.

• True

• False

Trade-offs do not require all-or-nothing choices. Rather, they involve giving up some of one thing to gain more of another.

• True

• False

Opportunity Cost is the value of something that is given up to get something else that is wanted.

• True

• False

__________________________ is an approach that weighs the benefits of an action against its costs.

• cost-benefit analysis

• marginal cost

• marginal benefit