ECO Revision before UT

What is Economics?

• It is a study of how people invest in the stock market.

• It is a study of how people make money.

• It is a study of how scarce resources are allocated to satisfy human wants.

• It is a study of how the problem of scarcity is solved.

Which of the following statements is CORRECT?

• Wants arise because scarce resources are unevenly distributed.

• Wants do not have to be supported by purchasing power.

• Wants exist because of scarcity.

• Wants are the same as demand.

Which of the following about scarcity is CORRECT?

• Only poor people face scarcity.

• Scarcity exists because human wants are limited.

• Scarcity exists because the supply of resources is fixed.

• People have to make choice because of scarcity.

​ The existence of scarcity implies that

​ (a)  

• the supply of resources is limited.
• competition for goods is inevitable.
• Choices have to be made

Which of the following does NOT involve an opportunity cost?

• Catherine uses the scholarship provided by the government to pay for the school fee, and the scholarship can be used for that purpose only.

• Peter decides to spend $500 on a wallet.

• John spends two hours watching a film that is free of charge

• Simon goes out for dinner.

Compared with an office assistant, a doctor is less likely to change his occupation because

• the cost of being an office assistant is lower.

• the cost for an office assistant to change his occupation is lower than that of a doctor.

• a doctor has to spend a long time studying medicine.

• an office assistant is not a professional.

Which of the following is her opportunity cost of choosing a box of cookies?

• a pack of orange juice

• a box of chocolate

• a pack of orange juice and a box of chocolate

• a bottle of cooking oil

Which of the following will increase Yamaha's cost of driving his car?

• The vehicle first-registration tax increases

• The price of steel increases

• The of gasoline increases

• The price of public transport increases

Which of the following is/are the opportunity cost(s) of showing “A Symphony of Lights” (幻彩詠香江)?

(1)       The money spent on buying equipment needed in the show.

(2)       The time spent on preparing the show.

(3)       The time spent on watching the show.

• (2) only

• (1) and (2) only

• (1) and (3) only

• (1), (2) and (3)

Which of the following statements about opportunity cost is CORRECT?

• When the value of an option increases, the opportunity cost of choosing that option increases.

• Opportunity cost does not exist in a barter economy.

• If there is no choice, there is no opportunity cost.

• When the value of options other than the highest-valued option forgone changes, the opportunity cost of choosing an option increases.