According to the possible trade-off example between warships and drinking water in the text, the policy question that should be considered in Malaysia is do the benefits of the warships exceed their opportunity costs? do the nominal costs of the warships exceed their real costs? do the opportunity costs of the warships exceed their nominal costs? do the real costs of the warships exceed their nominal costs?

Explanation:

I will start by explaining the question, although it's incomplete.

This is Economics, first of all. The Malaysian government needs to or wants to spend on some goods. Since the law of Economics states that human needs always exceed the available resources to cater for them all at once; the Malaysian government is in a state of 'choice'!

Choice involves catering for certain needs at one time, while leaving the others undone. So the two goods here are war ships and drinking water.

The Malaysian government economic policy makers are trying to check the benefits and possible effects of trading the provision of drinking water for the purchase of war ships. I suppose they're tending towards the purchase of war ships because presently, there is war or insecurity in the land. If this be the case, the nominal costs, opportunity costs, and real costs of spending more on war ships than on drinking water, should be examined.

Opportunity cost is the cost of the forgone alternative; which is drinking water in this case. Will more people (citizens) die if there are no new war ships provided at this time OR will more people (citizens) die if there is no extra provision of drinking water at this time? This is the summary of all the questions in the question text above!

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