The most important economic concept to consider when deciding whether to produce a product domestically or import the product is
A)law of supply
B)law of demand
C)opportunity cost
D)law of increasing cost

Question

Quizplus · Accepted Answer

When deciding whether to produce a product domestically or import the product, the most important economic concept to consider is opportunity cost. Opportunity cost refers to the cost of the next best alternative forgone when making a decision, including the cost of producing the product domestically versus importing it from another country. Therefore, companies must consider the cost of producing the product domestically, including labor costs, taxes, and regulatory costs, against the cost of importing the product from another country, including transportation costs, tariffs, and foreign exchange rates. By considering the opportunity cost, companies can make a more informed decision about whether to produce the product domestically or import it.

The Most Important Economic Concept to Consider When Deciding Whether