A football game between the Thunder and the Sharks is in its closing minutes, with the Thunder ahead by 20 points. The Thunder’s coach considers sending in the second-string quarterback. This would reduce the risk of the star quarterback getting injured, but the second-string quarterback is not very good. Complete the passage describing the coach’s decision in economic terms.
1. Fill in the blanks with appropriate option.
The coach is weighing a slightly _____ risk of losing against a slightly decreased risk of injury to the star quarterback. This weighing of is an example of _, because the star quarterback was in for most of the game, and the coach's decision concerns ________ shifts in probabilities with the game nearly over
Options:
A) decreased *
B) large
C) marginal thinking.
D) small
E) increased
F) incentives
G) trade-offs

According to the passage, The coach is weighing a slightly increased risk of losing against a slightly decreased risk of injury to the star quarterback. This weighing of trade-offs is an example of marginal thinking, because the star quarterback was in for most of the game, and the coach's decision concerns small shifts in probabilities with the game nearly over.

nikitavidya0 nikitavidya0 · Answer 2 · 2021-12-17T12:59:19+01:00

The coach is weighing a slightly increased risk of losing against a slightly decreased risk of injury to the star quarterback. This weighing of trade- offs is an example of marginal thinking because the star quarterback was in for most of the game, and the coach's decision concerns small shifts in probabilities with the game nearly over.

The increase in risk implies the chances of return of positive gain is less but the gain would be higher than less risky opportunities.

Trade-offs situations represent the increase of one variable but with fall in other variable values. Thus, the coach is making a trade-off between the risk of losing and the risk of injury.

Marginal thinking implies a comparison of benefits and costs when one more unit is added for optimal decision.

The shift in probabilities refers to small variations made in chances of winning by stimulation the strategy to get better outcomes.

Learn more about economic terms here:

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