Ch. 1 Scarcity and Opportunity Cost

Which of the following is true about scarcity?

• Scarcity affects all societies
• Scarcity exists only in poor countries
• Scarce goods lead to lower prices
• Scarcity of resources can be eliminated using sound economic policies

Grace and Noah are starting a small bakery. Which of the following is NOT a basic question in Economics that they need to consider?

• What to produce?

• How to produce?

• For whom to produce?

• Where to produce?

Mia is shopping for various items. Which of the following is an example of a nondurable good?

• Clothing

• Cars

• Tools

• Robots

Luna is looking for something essential for her daily life. An example of a needed good is:

• A place to live

• A car

• A cell phone

• Internet

James and Lily are preparing for a survival trip. Check off the following that are needs.

• Books

• Water

• Clothing

• Transportation

• Shelter

Charlotte and Zoe are discussing the concept of "There is no such thing as a free lunch" (TINSTAAFL). Explain the meaning of this phrase in the context of their discussion. Be specific with your answer.

Henry has $100 and he can either buy a new video game or invest in a stock. Define opportunity cost and provide an example of opportunity cost in this scenario.

David is starting a new business and needs to understand the primary factors of production. Which of the following is a primary factor of production?

• Money

• Labor

• Technology

• Advertising

During a class discussion, Kai asked, 'Which of the following is a renewable resource?'

• Coal

• Natural Gas

• Solar Energy

• Oil

Henry is setting up a new factory. Which of the following is an example of a capital good he might need?

• Machinery

• Food

• Clothing

• Water