Opportunity cost helps the government to?

A. Distribute money to citizens
B. support better production
C. remove competition
D. prepare budget

Correct Answer:

Option D – prepare budget

Explanation

Opportunity cost refers to a benefit that a person could have received, but gave up, to take another course of action. Opportunity cost helps the government in the preparation of budget since it assists in the effective allocation of scarce resources to certain sectors of the economy. It helps in making certain decisions e.g. the priority areas that may require immediate attention.