Choice:

Choices become necessary as a result of scarcity. Making a choice implies giving up something in order to get something else. The concept of choice relates to all the three main economic agents in the economy.

•  An individual consumer must choose among types of goods and services, between present and future consumption because of his limited money income.
•  The firm must choose what to produce and how to produce within cnstraint imposeed by its limited resources.
•  The government must decide what public goods and services to provide for the people given its limited revenue as projected in the budget documents.