On what basis do you make economic decisions? One potential approach is to employ the cost-benefit principle, which suggests engaging only in those actions that create an economic surplus. Considering other criteria such as opportunity costs helps you to make a rational choice. For example, when budget crises occur, local or national governments may opt to cut back on critical programs, while many others may consider raising taxes.
Post by Day 3 a 250- to 300-word statement that addresses the following:
- What are the opportunity costs of reducing expenditures (such as on education and social services programs), compared to the option of raising taxes? Why?
- Explain what you think are the rational choices in such a situation, and what other options should be considered and why.
Read a selection of your colleagues postings.
Respond by Day 6 to two or more of your colleagues postings in one or more of the following ways:
- Ask a probing question.
- Share an insight from having read your colleagues posting.
- Offer and support an opinion.
- Make a suggestion.
- Expand on your colleagues posting.
Return to this Discussion in a few days to read the responses to your initial posting. Note what you learned and the insights you gained as a result of the comments your colleagues made.
Be sure to support your work with specific citations from the Learning Resources and any additional sources.