(Micro 1.1) Thinking Like an Economist - Scarcity

Where would the armor go? Why?

Why should you learn about economics?

• Understanding economics leads to building wealth.

• You'll be smarter than your friends about the stock market.

• Thinking like an economist will help you be a better decision maker.

• Because Mr. Mize said so.

What does "guns and butter" stand for?

• People should buy more guns than butter.

• Choosing to spend on military goods or consumer goods.

• These are the two necessities for a military to be effective.

• You used to lubricate guns with butter, making butter a valuable commodity because of its dual purpose.

What are the three factors of production?

• Land

• Money

• Capital

• Labor

Which of the following is the most fundamental issue that economics addresses?

• Choice of appropriate technology.

• Promotion of privatization.

• Reduction of budget deficit.

• Use of scarce resources.

Why does scarcity exist?