The existence of the cost-benefit principle stems from
A) the limited nature of wants.
B) the trade-offs the scarcity problem indicates must be made.
C) the necessity of government intervention.
D) opportunity costs.
E) the unlimited nature of resources.

Question

Quizplus · Accepted Answer

The cost-benefit principle is based on the recognition that resources are scarce and trade-offs must be made when allocating them. Therefore, choice B, which refers to the trade-offs implied by the scarcity problem, is the best answer. Choices A, C, and E are not directly related to the cost-benefit principle, while choice D is a concept that is closely related to the principle but does not fully capture its essence.

The Existence of the Cost-Benefit Principle Stems from