In considering how to allocate its scarce resources among its various members, a household considers: a) Each member's abilities, b) Each member's efforts, c) Each member's desires, d) All of the above are correct

Business Dec 10, 2020

In considering how to allocate its scarce resources among its various members, a household considers:

a) Each member's abilities,

b) Each member's efforts,

c) Each member's desires,

d) All of the above are correct.

Expert Solution

The answer is d).

When deciding how to allocate resources, the household must respect the amount of resources the household has, while attempting to make all members as happy as possible. To do so, the household must respect each member's desire to understand what makes them happy, but also at the same time know the constraints, which are determined by each member's efforts and abilities.

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