Externalities are a shortcoming of the market

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Reference no: EM13995092

Gilberto is an owner of a professional sports team in a large league. To promote fairness, the team with the most losses in the league automatically gets the best new player to enter the league next year. Consider the following sentence: In order to get the best new player next year, Gilberto orders his team to intentionally lose as many games as possible. Which basic concept of individual choice does this sentence best illustrate? Opportunity costs and money costs (price) are related, but not always exactly the same. Externalities are a shortcoming of the market. All costs are opportunity costs. An optimal decision is one that best serves the objectives of the decision maker.

Reference no: EM13995092

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