1. Because of the problem of scarcity, each economic system must make which of the following
choices?
a. How to produce?
b. What to produce?
c. For whom to produce?
d. All of the above.
ANSWER: D
2. Which fundamen
...
1. Because of the problem of scarcity, each economic system must make which of the following
choices?
a. How to produce?
b. What to produce?
c. For whom to produce?
d. All of the above.
ANSWER: D
2. Which fundamental economic question is most closely related to the issues of income
distribution and poverty?
a. The What to Produce question.
b. The Why to Produce question.
c. The How to Produce question.
d. The For Whom to Produce question.
ANSWER: D
3. Which fundamental economic question requires society to choose the technological and
resource mix used to produce goods?
a. The What to Produce question.
b. The Why to Produce question.
c. The How to Produce question.
d. The For Whom to Produce question.
ANSWER: C
4. The opportunity cost of watching television is:
a. all of the alternative programs that appear on other stations.
b. zero because there is no money expenditure involved.
c. the alternative use of the time foregone by watching the program.
d. zero if it benefits you.
ANSWER: C
5. The opportunity cost of an economic decision is:
a. the best alternative that was sacrificed.
b. the amount of money needed to implement the decision.
c. any land, labor, and capital that are wasted.
d. all options that were lost due to scarcity.
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