Scarcity, Economy

The study of how individuals and nations make choices about how to use scarce resources to fulfill their wants describes

• an opportunity cost.

• entrepreneurship.

• economics.

• scarcity.

Scarcity of resources is always present because

• there will always be natural disasters to affect the production of goods and services.

• we live in a world where poverty still exists.

• people are not willing to change their unlimited wants.

• certain resources will always be limited in their availability.

All of the following are factors of production EXCEPT

• land
• money
• labor
• capital

Which of the following refers to the resource of land?

• bus drivers
• iron ore
• money
• machinery

Because wants are unlimited but resources are limited, society must economize. This means that society must

• use its resources in such a way as to get the most out of them.
• save as much money as possible.
• keep its budget balanced.
• limit the use of its resources.

The opportunity cost of an increase in the local police force is

• the cost of additional police salaries and benefits.
• the cost of training new recruits.
• the amount by which taxes will be increased to pay for additional police.
• the goods or services that will be given up in order to hire the additional police.

When Amy returns a good library book without finishing it so she won’t have to pay a late fee, what is her opportunity cost?

• paying the fee
• paying for something else
• finishing the book
• reading a different book

What is the basic economic problem that all economies must deal with?

• How to satisfy limited wants with limited resources

• How to satisfy limited wants with unlimited resources

• How to satisfy unlimited wants with limited resources

• How to satisfy unlimited wants with unlimited resources

The end of a pencil is made of rubber. This represents what factor of production?

• land

• labor

• capital

• entrepreneurship

In economics, capital refers to

• all natural resources.

• labor used to produce a product.

• man-made items needed for production.

• the risk taker who invests in a new product