Which statement best defines business activity as introduced in this section?

• Any activity that creates entertainment for people

• Any activity that provides goods and services to satisfy people’s needs and wants using factors of production

• Only the process of selling products in markets

• Government actions to control prices

Identify the correct pairing of goods and services based on the definitions provided.

• Goods: teaching; Services: cars

• Goods: food; Services: transport

• Goods: healthcare; Services: clothes

• Goods: engineers; Services: factories

Which of the following is a need rather than a want?

• Luxury clothes

• New phone

• Holiday

• Water

What is the economic problem of scarcity?

• Resources are unlimited while human wants are limited

• Resources are limited while human wants are unlimited, requiring choices

• Prices are always increasing in markets

• Businesses cannot produce services

Opportunity cost is defined as:

• The total cost of producing a product

• The next best alternative that you give up when making a choice

• The price difference between brands

• The profit after all costs are paid

Using the AED 20 cinema example, what could be the opportunity cost?

• Buying a new phone

• Saving for a holiday

• The meal you could have bought instead

• Paying for transport

Which option correctly matches a UAE example to its factor of production?

• Land — teachers

• Labour — airports

• Capital — machines

• Enterprise — sunlight

Which statement about specialization is accurate according to the material?

• Specialization always eliminates risk

• Specialization focuses on what people or countries are best at, increasing efficiency and productivity

• Specialization increases cost of production and reduces quality

• Specialization means producing a wide range of unrelated products

Select the benefit that is listed for specialization.

• Lower efficiency

• Higher cost of production

• Leads to higher quality and faster production

• Eliminates all market risks

Which industries are given as UAE examples of specialization?

• Agriculture, mining, and retail

• Aviation, tourism, and oil

• Healthcare, education, and construction

• Banking, textiles, and automobiles