ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Trade-offs are all the alternatives that we give up whenever we choose one course of action over others. The most desirable alternative given up as a result of a decision is known as opportunity cost.

Detailed explanation-2: -A tradeoff is loosely defined as any situation where making one choice means losing something else, usually forgoing a benefit or opportunity. We experience tradeoffs in zero-sum situations when a plus in one area must be a negative in another.

Detailed explanation-3: -ˈtrād-ˌȯf. Synonyms of trade-off. : a balancing of factors all of which are not attainable at the same time. the education versus experience trade-off which governs personnel practices H. S. White. : a giving up of one thing in return for another : exchange.

Detailed explanation-4: -In economics, a trade-off is defined as an “opportunity cost.” For example, you might take a day off work to go to a concert, gaining the opportunity of seeing your favorite band, while losing a day’s wages as the cost for that opportunity.

Detailed explanation-5: -All choices, whether they are made by individuals or by groups of individuals such as governments, have a cost associated with them; economists call this an Opportunity Cost. Opportunity cost is the value of the benefits of the foregone alternative, of the next best alternative that could have been chosen, but was not.