3. Scarcity, Opportunity Cost and PPF curve

Question 1

What are the the problems of scarcity?

Answer 1

Efficiency and Equity

Question 2

What is Efficiency?

Answer 2

Getting the most we can from our limited resources

Question 3

Equity

Answer 3

The distribution of resources among society

Question 4

What is Opportunity cost?

Answer 4

forgone value of the next best alternative, associated loss of the decision

Question 5

What does a PPF convey?

Answer 5

Maximum combinations of goods and services that can be produced given limited resources

Question 6

What is scarcity in economics?

Answer 6

balancing our unlimited wants to our limited resources

Question 7

Give an example of opportunity cost

Answer 7

by studying science for another hour, you give up earning 10 more points studying math for an hour

Question 8

What are the 4 basic questions that arise because of the problem of scarcity?

Answer 8

1. What to produce,
2. How much to produce
3. For whom to produce
4. How to produce

Question 9

Why does scarcity exists?

Answer 9

our natural, human and capital resources are limited but our wants and needs are endless

natural resources are finite but our needs and wants are endless