Unit 1 Day 1 Questions (Scarcity, Factors of Production)

Scarcity is best defined as

• The cost of the next best decision regarding limitations of time and money

• The fact that people have limited wants but unlimited resources

• The fact that people have unlimited wants and limited resources

• The opportunity cost of deciding between one tradeoff versus another

Resources (factors of production) are

• scarce for households but plentiful for economies.

• plentiful for households but scarce for economies.

• scarce for households and scarce for economies.

• plentiful for households and plentiful for economies.

• owned by households and scarce for economies.

Any resources that are made by humans, such as machines, and used to create other goods and services are called

• services.

• production.

• capital.

• labor.

Economics may best be defined as a

• scientific study of supply and demand.

• study of choices that are made with respect to a limited description of economic activities

• study of choices people make in light of their desire for unlimited wants but the reality of limited resources.

• branch of sociology that examines the choice making process in light of supply and demand.

The overriding reason as to why households and societies face many decisions is that

• resources are scarce.

• goods and services are not scarce.

• incomes fluctuate with business cycles

• people, by nature, tend to disagree.

• wants are scarce.

Which of the following would NOT be considered a factor of production

• trees used for making paper

• Puff Daddy (or P-Diddy, Diddy, Sean Combs, or whatever he calls himself these days)

• a worker at Wal-Mart

• an iphone used for text messaging between you and your friend

A computer, smart phone, and projector are all goods used for a business. In economics, these are known as

• human capital

• financial capital

• physical capital

• consumer goods

One example of an entrepreneur is

• a writer who is hired by a film studio to adapt a novel into a screenplay.

• a lawyer in a high-profile law firm that specializes in business law.

• an Olympic ice skater who later decides to join a professional ice show.

• an artist who runs a business painting murals in office buildings and

  restaurants.

Kenyan Abraham was recently hired as a clown for Bubba's Clown Company. Bubba decided to send Kenyan off to clown camp in order to increase his ability to entertain. Economists would assert that Bubba's Clown Company has made

• Kenyan a very happy young man.

• an investment in a capital good.

• an investment in human capital.

• an capital gain in the factor of productions.

The definition of Scarcity is...

• An unlimited amount of resources to meet limited wants and needs

• A limited amount of resources to meet unlimited wants and needs.

• When people use time and energy to create events

• a city where individuals commit themselves to unlimited wants and needs