Economics is often described as a science of constrained choice. How do you justify this argument?
What will be an ideal response?
Economics deals with the allocation of limited resources to satisfy unlimited human wants. We need resources such as labor, capital, raw material, etc. to produce goods and services to satisfy man’s unlimited needs. These resources are not only scarce but they have more than one use. The scarcity of resources means humans are constrained in the choices they make about the goods and services they produce, and thus also about which wants they will ultimately satisfy.
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When the U.S. government provides military aid to other governments, this enters into the U.S. balance of payments account as
a. merchandise exports b. merchandise imports c. income payments on investments d. unilateral transfers e. change in U.S. assets abroad
Price leadership works only if there is a single, dominant firm in the oligopoly
a. True b. False Indicate whether the statement is true or false
In 2010 the federal government reduced the Social Security tax withholding rate from 12.4 percent (6.2 percent on both the employer and employee) to 8.4 percent (4.2 percent on both the employer and employee) on the wages of all workers. If the supply of labor is relatively inelastic when compared to the elasticity of the demand for labor, the burden of this tax will
a. continue to fall primarily on employees. b. continue to fall primarily on employers. c. be divided equally between employees and employers. d. change from primarily falling on employees to employers.
Producer surplus equals
a. Value to buyers - Amount paid by buyers. b. Amount received by sellers - Costs of sellers. c. Value to buyers - Costs of sellers. d. Value to buyers - Amount paid by buyers + Amount received by sellers - Costs of sellers.