ECONOMIC DECISION-MAKING

Economic Decision-Making

Economic Decision-Making

The decisions are the fundamental essentials of our lives. We take decisions on every step, every place and for everything, in order to estimate the feasibility and benefit of the particular thing to us. We estimate the utility of all the goods and services we consume. Thus, to analyze all such things beforehand, we tend to calculate and make the decisions which are economical, rational, and logical and take into consideration, the concept of opportunity cost.

This paper will briefly discuss the economic decision-making process and the context in which they are taken. Moreover, it will also explore different types of economies existing in the markets these days.

Principles of Economic Decision-Making

There are certain principles and guidelines which are to be undertaken while making an economic decision. Such decisions entail the costs and benefits involved in choosing among two or more alternatives. It may vary in significance and connotation and should be planned properly and implemented quickly. One of the main principles that an individual has to undertake is to correctly administer the steps of planning, organizing, directing and controlling. This implies that they have to highlight the long-term objectives, goals, strategies to achieve the goals, functioning and managing of the decision-making process. The individual has to analyze the goals and objectives on the basis of the extent of its rationality and optimization. The various alternatives and existing variables need to be identified and evaluated while planning for an economic decision-making process. Moreover, availability of proper raw data and modified facts and figures in the form of information should be undertaken to analyze. All the alternatives are to be looked for and an effective and weighty alternative needs to be considered and evaluated. (Charles, 1965)

After all the thinking, judging and perceiving process, the best alternative, in ...