In economics, scarcity means that:
A shortage of a particular good will cause the price to fall.
A production-possibilities curve cannot accurately represent the tradeoff between two goods.
Society's desires exceed the want-satisfying capability of the resources available to satisfy those desires.
The market mechanism has failed.
Given that resources are scarce:
A "free lunch" is possible but only for a limited number of people.
Opportunity costs are experienced whenever choices are made.
Poor countries must make choices but rich countries with abundant resources do not have to make choices.
Some choices involve opportunity costs while other choices do not.
A consequence of the economic problem of scarcity is that:
Choices have to be made about how resources are used.
There is never too much of any good or service produced.
The production of goods and services must be controlled by the government.
The production-possibilities curve is bowed outward.
The basic factors of production include:
Land
Labor
Money
Entrepeneurship
Capital
Inputs
Economics can be defined as the study of:
For whom resources are allocated to increase efficiency.
How society spends the income of individuals.
How scarce resources are allocated to best meet society's goals.
What scarce resources are used to produce goods and services.
Opportunity cost is:
Only measured in dollars and cents.
The dollar cost to society of producing the goods.
The difficulty associated with using one good in place of another.
The alternative that must be given up in order to get something else.
A production-possibilities curve indicates the:
Combinations of goods and services an economy is actually producing.
Maximum combinations of goods and services an economy can produce given its available resources and technology.
Maximum combinations of goods and services an economy can produce given unlimited resources.
Average combinations of goods and services an economy can produce given its available resources and technology.
Which of the following is an assumption under which the production-possibilities curve is drawn?
There is significant unemployment.
The supply of factors of production is fixed.
The price level is changing.
Technology is changing.
According to the law of increasing opportunity costs:
The more one is willing to pay for resources, the larger will be the possible level of production.
Increasing the production of a particular good will cause the price of the good to rise.
In order to produce additional units of a particular good, it is necessary for society to sacrifice increa
Only by keeping production constant can rising prices be avoided.
If Korea is currently producing at efficiency, and it proceeds to increase the size of its military, then, as long as nothing else changes, its:
Production-Possibilities curve will shift outward.
Production-possibilities curve will shift inward.
Production of non military goods wll increase
Production of non military goods will decrease.
Which of the following is true when an economy is producing efficiently?
The economy is producing on the production-possibilities curve.
Goods and services are being produced using the fewest resources.
The economy is getting the most goods and services from the available resources.
All of the above.
Which of the following will cause the production-possibilities curve to shift inward?
An increase in population.
A technological advance.
A decrease in the size of the labor force
An increase in knowledge.
