What Is a Tradeoff? Give an Example

question 166

Essay

What is a tradeoff? Give an example.

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Definitions:

Opportunity Costs

The loss of potential gain from other alternatives when one alternative is chosen; the value of the next best choice.

Financial Investment

The purchase of a financial asset (such as a stock, bond, or mutual fund) or real asset (such as a house, land, or factories) in the expectation of financial gain.

Bank Certificate

A document issued by a bank certifying the deposit of money or financial instruments with a certain value.