Scarcity in economics refers to:
A) Unlimited resources for production
B) The limited availability of resources to meet unlimited wants
C) The limited demand for goods and services
D) A lack of choices in the market
The concept of opportunity cost is best described as:
A) The total cost of producing one good
B) The next best alternative forgone when making a decision
C) The price of a good in the market
D) The total amount of resources available for production
Which of the following illustrates the concept of scarcity?
A) The government has unlimited control over resources
B) People can only consume what is available at any given time
C) Resources are always abundant and not limited
D) There is enough to meet all human wants
An example of opportunity cost is:
A) The time spent studying for a test instead of going out with friends
B) The money spent on a car
C) The total wages you earn from a job
D) The resources required to build a factory
When making a choice, opportunity cost refers to:
A) The cost of producing the chosen option
B) The monetary value of the decision made
C) The value of the next best alternative foregone
D) The amount of resources available for the decision
Scarcity forces individuals and societies to:
A) Use resources efficiently
B) Make choices on how to allocate limited resources
C) Produce an unlimited number of goods
D) Keep prices constant in the market
Which of the following is an example of a trade-off due to scarcity?
A) Choosing between spending time on work or leisure activities
B) Deciding on the price of a good
C) Printing more money to increase wealth
D) Deciding which technology to use for communication
A key assumption in economics regarding scarcity is that:
A) Resources are infinite
B) Wants are limited
C) Resources are limited, but wants are unlimited
D) Resources can always be shared equally
The opportunity cost of attending college includes:
A) The money spent on tuition fees only
B) The cost of books and supplies only
C) The forgone wages you could have earned by working instead
D) The total value of your education
Which of the following would not be considered an opportunity cost?
A) Choosing to spend money on a vacation instead of saving for retirement
B) Deciding to go to a concert instead of working
C) Using a resource to produce one good instead of another
D) The total expenditure on a product
Which statement is true regarding scarcity?
A) Scarcity only affects individuals, not societies
B) Scarcity is a situation where resources exceed human wants
C) Scarcity is an unavoidable condition that forces individuals to make choices
D) Scarcity does not influence economic decision-making
The idea of a “production possibility frontier” (PPF) is based on the concept of:
A) Unlimited resources and scarcity
B) A linear relationship between goods and resources
C) Scarcity and opportunity cost in production decisions
D) The production capacity of one good only
Which of the following best describes a trade-off?
A) The same amount of resources are used for each good
B) The value of the next best alternative given up when making a decision
C) The total benefit derived from consuming a good
D) A situation where scarcity does not exist
What is the opportunity cost of using land for housing development?
A) The opportunity to use the land for agriculture or recreation
B) The money spent on building materials
C) The cost of labor for construction workers
D) The depreciation of land value
Scarcity and choice are interrelated because:
A) Scarcity leads to a surplus of goods and services
B) Scarcity forces individuals to make choices about how to allocate resources
C) Choice results in unlimited resources being available
D) Scarcity does not affect the choices people make
In economics, when we make a choice, we:
A) Always maximize benefits with no costs
B) Evaluate the cost of alternatives and the benefits derived from them
C) Eliminate opportunity costs
D) Ignore the potential trade-offs of each decision
Which of the following represents the opportunity cost of using a car?
A) The time spent driving
B) The cost of the fuel
C) The money spent on insurance
D) The potential benefits from not using the car and using an alternative form of transportation
The law of increasing opportunity cost implies that:
A) The more of one good produced, the greater the opportunity cost of producing another unit of that good
B) Resources are always used efficiently
C) There is no cost to producing more of one good
D) The economy’s resources are unlimited
Scarcity leads to:
A) No economic problems
B) An unlimited production of goods
C) The need for choices and prioritization in resource allocation
D) Infinite economic growth
In making a decision about spending money, opportunity cost is:
A) The price of the good or service purchased
B) The total amount of income available
C) The best alternative that must be forgone to pursue the chosen option
D) The sum of all the expenses involved in making the decision
Which of the following would increase the opportunity cost of producing a good?
A) A decrease in the availability of resources
B) An increase in resource efficiency
C) The opportunity to export more goods
D) A technological improvement in production
A society’s economic problem of scarcity arises because:
A) Wants and needs are limited
B) Resources are limited but wants are infinite
C) People don’t have enough income
D) Technology is always improving
The opportunity cost of an action is:
A) The cost that is incurred in the long run
B) The total amount spent on a good
C) The total cost of all alternatives considered
D) The value of the best alternative forgone in the decision-making process
When individuals and firms make choices, they often face trade-offs because of:
A) Scarcity and limited resources
B) Unlimited resources
C) A lack of information
D) Perfect competition in the market
Opportunity cost can be measured in:
A) Only monetary terms
B) Time, money, and resources
C) Utility only
D) Only time
