Three basis decisions must be made by all economies. What are they ?
what to produce, how it is produced, and who consumes it.
what the price of each good will be.
how the opportunity cost principle will be applied; if and how the law of comparative advantage will be utilized; whether the production possibilities constraint will apply.
what will be produced and for whom goods will be produced.
A
what will be produced and for whom goods will be produced.
B
what to produce, how it is produced, and who consumes it.
C
what the price of each good will be.
D
how the opportunity cost principle will be applied; if and how the law of comparative advantage will be utilized; whether the production possibilities constraint will apply.
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Solution
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The three basic decisions made by all economies are what to produce, how it is produced, and who consumes it.
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