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Question: 1 / 400

Which term describes the assessment of costs and benefits related to economic decisions?

Marginal analysis

The most accurate term that describes the assessment of costs and benefits related to economic decisions is cost-benefit analysis. This process involves comparing the expected costs of a particular decision to the expected benefits, allowing individuals and organizations to evaluate whether the potential gains outweigh the expenses. This analytic approach is fundamental in economic decision-making and helps determine the feasibility and desirability of different options.

Marginal analysis, while related to decision-making, specifically focuses on the benefits and costs associated with small, incremental changes in production or consumption rather than a broader assessment of total costs versus total benefits. Economic forecasting refers to predicting future economic conditions based on current data and trends, without focusing directly on individual decisions. Risk assessment evaluates potential hazards and the probability of unfavorable outcomes, which is important in decision-making but does not inherently entail a costs versus benefits evaluation.

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Cost-benefit analysis

Economic forecasting

Risk assessment

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