The correct answer is: B. Allocation of resources over time.
Inter-temporal allocation of resources refers to the allocation of resources across different time periods. It is a key concept in economics, as it helps to explain how individuals and businesses make decisions about how to use their resources.
There are a number of factors that can affect inter-temporal allocation of resources. One important factor is the time value of money. This refers to the fact that money that is available today is worth more than money that will be available in the future. This is because money that is available today can be invested to earn a return, while money that will be available in the future cannot.
Another important factor that can affect inter-temporal allocation of resources is risk. Risk refers to the possibility that an outcome will not be as expected. When individuals or businesses make decisions about how to allocate their resources, they need to consider the risk of different outcomes. For example, a business might decide to invest in a new product, but it will need to consider the risk that the product will not be successful.
Inter-temporal allocation of resources is a complex issue, and there is no single “right” way to do it. The best way to allocate resources will depend on a number of factors, including the time value of money, risk, and the individual or business’s goals.
Here is a brief explanation of each option:
- A. Postponing allocation of resources until the time is right. This is not an accurate definition of inter-temporal allocation of resources. Inter-temporal allocation of resources refers to the allocation of resources across different time periods, not to the postponement of resource allocation.
- B. Allocation of resources over time. This is the correct definition of inter-temporal allocation of resources.
- C. Temporary allocation of resources. This is not an accurate definition of inter-temporal allocation of resources. Inter-temporal allocation of resources refers to the allocation of resources across different time periods, not to the temporary allocation of resources.
- D. Diversification of resource allocation. This is not an accurate definition of inter-temporal allocation of resources. Diversification of resource allocation refers to the spreading of risk by investing in a variety of different assets. Inter-temporal allocation of resources refers to the allocation of resources across different time periods.