Which of the following explains why economic choices must be made?
a) The factors of production are used inefficiently.
b) The factors of production are scarce.
c) The factors of production are expensive.
d) The factors of production are of inferior quality.
Answer: b) The factors of production are scarce.
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Which of the following is a normative concept?
a. Nash equilibrium. b. Stackelberg equilibrium. c. Pareto optimality. d. Nash equilibrium, Stackelberg equilibrium, and Pareto optimality are all normative concepts.
Henry David Thoreau faced a choice: Stay in the village of Concord or move out to Walden Pond. He decided to move to Walden. What was his" opportunity cost"?
A) There was no opportunity cost if he didn't pay rent for his cabin on Walden Pond. B) The satisfaction he would have enjoyed were he to stay in Concord C) The sweat and toil of building his own cabin and living off the land at Walden Pond D) There was no opportunity cost, because he made a free and voluntary decision to live the way he preferred to live.
If the demand for a good is perfectly elastic, then the demand curve is horizontal
Indicate whether the statement is true or false
In a properly operating, dynamic economy
What will be an ideal response?