Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Scarcity
B
Resource allocation
C
Economic efficiency
D
Marginal cost
Understanding the Answer
Let's break down why this is correct
Answer
The production possibilities curve (PPC) shows the maximum output of two goods that an economy can produce using its resources. Opportunity cost refers to what you give up when you choose one option over another. In the context of trade-offs, this means that when you decide to use your resources for one good rather than another, you face a trade-off between them. For example, if a farmer decides to grow wheat instead of corn, the trade-off is the amount of corn he could have produced instead of the wheat. So, just like opportunity cost relates to PPC, a trade-off relates to the choices we make when allocating our resources.
Detailed Explanation
A trade-off happens when you choose one thing over another. Other options are incorrect because Scarcity means there are not enough resources for everyone; Economic efficiency means using resources in the best way possible.
Key Concepts
Opportunity Cost
Production Possibilities Curve (PPC)
Trade-offs
Topic
Opportunity Cost and PPC
Difficulty
easy level question
Cognitive Level
understand
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