When a government decides to fund public education, it must often reduce spending on other areas like infrastructure or defense. This trade-off is an example of which economic principle?

A Law of supply and demand

B Comparative advantage

C Opportunity cost

D Diminishing returns

✓ Correct Answer: Option C

Opportunity cost is the value of the next best alternative that must be foregone when making a choice. Funding education means giving up the benefits of spending that money elsewhere.

💡 Why is C) the correct answer?

The correct answer to the question "When a government decides to fund public education, it must often reduce spending on other areas like infrastructure or defense. This trade-off is an example of which economic principle?" is Option C: Opportunity cost.

The other options — A) Law of supply and demand, B) Comparative advantage, D) Diminishing returns — are incorrect for this GED Exam Prep question. As explained above: Opportunity cost is the value of the next best alternative that must be foregone when making a choice. Funding education means giving up the benefits of spending that money elsewhere.

📚 About This GED Exam Prep Practice Question

This 2-level GED Exam Prep question from the Social Studies topic is part of BrainForge Quiz's free exam preparation library. Each question includes the correct answer and a detailed explanation to help you understand the underlying concept, not just memorize the answer.

How to use this page: Read the question above, consider all four options (A through D), then check the highlighted correct answer and explanation. For active timed practice, start a free GED Exam Prep practice test or use flashcards for spaced repetition review.

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When a government decides to fund public education, it must often reduce spending on other areas like infrastructure or defense. This trade-off is an example of which economic principle?

✓ Correct Answer: Option C

📚 About This GED Exam Prep Practice Question

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