In economics a trade-off (or trade off) is a situation that implies a choice between two or more possibilities where the loss of value of one constitutes an increase in value in another.
The term is sometimes expressed as an opportunity cost, referring to more alternatives that you preferred to give up for another choice.
An example of trade-off can be found in the reverse relationship between working time and leisure time: increasing the value of an alternative necessarily decreases the second and vice versa.
Another practical example is that if the production factors are used for roses, they must be subtracted from the production of bananas. the trade-off is the basis of an optimization problem where one of the two functions is chosen as an objective function, and the other as a constraint on the problem. The resulting curve is typically a U-shaped (or U-shaped) curve with a minimum point in which the optimum (semi-continuous function) is located. When the resulting is a family of curves, one can define the envelope: for example in economics the (long-term) envelope of short curves that merges the single maximum / minimum point of a U-curve family. Links externalize the wikitesto
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