The fundamental problem of economics is
A. The scarcity of resources relative to human wants.
B. How to get government to operate efficiently.
C. How to create employment for everyone.
D. The law of increasing opportunity costs.
Answer: A
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The tools of "game theory" are most helpful to economists in markets characterized by: a. perfect competition
b. oligopoly. c. monopolistic competition. d. monopoly.
There is demand for and supply of dollars and a demand for and supply of pesos. Under a flexible exchange rate system, if income growth in the United States is greater than income growth in Mexico, then
A) the demand for dollars will shift to the right and the demand for pesos will shift to the left. B) the demand for pesos will shift to the right and the supply of dollars will shift to the left. C) the demand for pesos will shift to the left and the supply of pesos will shift to the right. D) the supply of pesos will shift to the right and the supply of dollars will shift to the right. E) none of the above
When a firm produces at a technically efficient output level, it is
A. Using the fewest resources to produce a good or service. B. Producing the output at the minimum MC curve. C. Producing the best combination of goods and services. D. Producing the output where the AVC curve is at a minimum.
Figure 4.3 illustrates the demand for tacos. A decrease in the demand for tacos is represented by the movement from
A) point a to point b. B) point c to point b. C) D2 to D1. D) D0 to D1.