Factors of Production and Scarcity
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Questions and Answers

What is the basic economic concept that describes the continuous shortage or scarcity of resources?

The problem of scarcity

What is the term used to describe resources that have a finite amount?

  • Unlimited
  • Scarce
  • Finite (correct)
  • Abundant
  • What are the four groups of resources referred to as the factors of production?

  • Labor, capital, natural resources, and technology
  • Capital, labor, natural resources, and entrepreneurs (correct)
  • Land, labor, capital, and entrepreneurs
  • Resources, capital, labor, and technology
  • The monument in Johannesburg commemorates the discovery of gold on the Highveld.

    <p>True</p> Signup and view all the answers

    Gold is a very important natural resource for the South African economy.

    <p>True</p> Signup and view all the answers

    The world's desire for gold is limited.

    <p>False</p> Signup and view all the answers

    Gold is an example of a finite resource.

    <p>True</p> Signup and view all the answers

    What is the term used to describe the value of the next best choice that was given up when making a decision about resource allocation?

    <p>Opportunity cost</p> Signup and view all the answers

    Study Notes

    Factors of Production

    • Money is used for buying and selling.
    • Earth's resources have value only when used.
    • Economics studies needs, wants, and how they are fulfilled through production.
    • People's needs are limited, but wants are not.
    • Resources to fulfill wants are finite.
    • Economics manages resource allocation.

    Scarcity

    • Consumers, businesses, and governments face continuous resource shortages.
    • Scarcity arises from finite resources.
    • A resource can have multiple uses.
    • Trading off one use for another results in an opportunity cost—the value of the next-best choice.

    Four Factors of Production

    • Capital, labor, natural resources, and entrepreneurs are the four factors of production.

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    Description

    Explore the fundamental concepts of factors of production and scarcity in economics. Understand how resources are allocated, the implications of limited availability, and the role of different factors such as capital and labor. This quiz will test your knowledge on how these elements interact to fulfill needs and wants.

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