AP Macro Unit 1 Scarcity and Opportunity Cost

How does scarcity influence economic choices?

• It eliminates the need for choices

• It forces individuals to make decisions

• It provides unlimited options

• It reduces competition

Define economics.

• Study of unlimited resources

• Study of how people use resources

• Study of natural sciences

• Study of historical events

Why is opportunity cost important in decision-making?

• It helps in identifying unlimited resources

• It ensures maximum profit

• It helps in evaluating the cost of alternatives

• It eliminates the need for choices

What does microeconomics focus on?

• National policies

• Individual and business decisions

• Global trade

• Historical data

Every economic decision has multiple _______.

• Benefits

• Trade-offs

• Costs

• Outcomes

How many opportunity costs does every economic decision have?

• One

• Two

• Three

• Four

What is a trade-off when going to economics class?

• Missing a part-time job

• Gaining knowledge

• Spending money

• Saving time

Which of the following is NOT a trade-off?

• Choosing between two jobs

• Deciding to study or work

• Spending time with family

• Gaining a new skill

Opportunity cost is best described as:

• The financial cost of a decision

• The time spent on a decision

• The value of the next best alternative

• The resources used in a decision

In economic terms, what does making a decision involve?

• Only financial considerations

• Evaluating trade-offs and opportunity costs

• Ignoring opportunity costs

• Focusing solely on benefits