How People Make Economic Decisions
Eco 212 Jerry Pacheco
Shonti JacksonMaking a decision can be an emotional and sometimes stressful experience. Making sound decisions requires patience, an open mind, and a willingness to try different techniques to arrive at a final solution.
How people make decisions, whether large or small, depend on several factors or principles. One principle that one must consider, is a trade off. What will one have to give up attaining the other When deciding to go back to school, one will have to weigh the options of time and expense against family and finances. One may consider if the benefits of earning a degree is worth the time and effort required. Another principle one may encounter is the ultimate cost of giving up one thing to get the other. While weighing the pros and cons one might consider the cost of going to school and if it cost effective. Campus courses versus online courses, travel time study time, and food are a few of the cost that might be considered. Something else to consider may be what one gets if he or she decides one way or the other. Incentives are what most decisions are based on. If one does this, the reward is that. Sometimes, the reward is the deciding factor for some decisions, for others, the rewards may not be as numerous, so the person may decide that it is not worth it. Whatever the process one uses for making decisions one must be diligent and thorough as the decision affects everyone involved.
Deciding to go back to school was a decision based on convenience and expense. Before making the final decision, all available options were discussed with the family. The pros and cons were listed and finally the cost and rewards were discussed. It was determined that going back to school to earn a degree in Small business would in fact bring many rewards. This degree along with the cosmetology license currently held would make it possible to own and run a successful business, making the family economically sound by increasing the family income.
Mankiw, Gregory Principles of Economics Chp. 1