Question

1. The giving up of one benefit or advantage in order to gain another regarded as more favorable.

2. The second-best alternative (or the value of that alternative) that must be given up when making a choice.: The second-best alternative (or the value of that alternative) that must be given up when making a choice.
3. A process of examining the benefits (positive results) and costs (what is given up – lost benefits) of each available alternative in arriving at a decision.: A process of examining the benefits (positive results) and costs (what is given up – lost benefits) of each available alternative in arriving at a decision.
4. A widely observed relationship in which the additional satisfaction (marginal utility) associated with consuming additional units of the same product in a given amount of time eventually declines.: A widely observed relationship in which the additional satisfaction (marginal utility) associated with

Answer 1

1. Trade off

2. Opportunity cost

3. Cost-benefit analysis

4. Diminishing marginal utility

Step-by-step explanation:

1. Giving up one benefit or advantage to gain another regarded as more favorable is called trade-off. Every economic decision involves some trade-off.

2. Opportunity cost is the second-best alternative or value of the alternative, that must be given up when making a choice. Because of scarce resources with alternative uses allocation of resources involves some opportunity cost.

3. Cost-benefit analysis can be defined as the process of examining the benefits and costs of each available alternative in arriving at a decision. Resources are allocated efficiently if the cost incurred and benefit earned is equal.

4. As we go on increasing the quantity consumed of a product, the marginal utility or satisfaction earned from its consumption goes on decreasing. This is called diminishing marginal utility.