Section 2
Individual Decision Making
Book
Version 3
By Boundless
By Boundless
Boundless Economics
Economics
by Boundless
4 concepts
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Scarcity Leads to Tradeoffs and Choice
When scarce resources are used, actors are forced to make choices that have an opportunity cost.
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Individuals Face Opportunity Costs
Individuals face opportunity costs when they choose one course of action over another.
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Individuals Make Decisions at the Margins
Individuals will choose the option that yields the greatest net marginal benefit.
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Individuals Respond to Incentives
Incentives are ways to encourage or discourage certain behaviors or choices.