Economics: Chapter 1 Quiz

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Questions and Answers

What does the concept of unlimited needs refer to in economics?

  • The constant increase in demand for goods and services in the market.
  • The condition where individuals desire more than what they can obtain. (correct)
  • The situation where resources are abundant and can fulfill all wants.
  • The ability of individuals to fulfill all their wants without any constraints.

What is the definition of scarcity in economics?

  • The desire for more than what is available in the market.
  • The competition between individuals for limited goods and services.
  • The inability to satisfy all our wants due to limited resources. (correct)
  • The imbalance between supply and demand in the economy.

What is the primary reason economic questions arise, according to the text?

  • The presence of unlimited wants and needs alongside limited resources. (correct)
  • The fluctuating nature of market demand and supply.
  • The unequal distribution of wealth among individuals.
  • The influence of government policies on consumer choices.

Why do individuals face limitations on what they can afford to buy?

<p>Due to their income and the prices they must pay for goods and services. (C)</p> Signup and view all the answers

Why do governments have limitations on what they can afford to provide?

<p>Due to the taxes they collect, which restrict their budget for public goods and services. (D)</p> Signup and view all the answers

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