,Economics Today, 18e (Miller)
Chapter 2 Scarcity and the World of Trade-Offs
2.1 Scarcity
1) Scarcity arises because
A) resources are finite and are inadequate to meet all human wants.
B) production of goods and services is always slow.
C) companies are slow to explore for new resources.
D) a large number of people live in poverty.
Answer: A
Diff: 2
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
2) Scarcity refers to
A) a shortage in a good or service.
B) the ability of society to consume all that it produces.
C) the inability of society to satisfy all human wants because of limited resources.
D) the inability of an individual to purchase a good or service due to her limited income.
Answer: C
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
3) Which of the following statements is TRUE about scarcity?
A) Both rich and poor people face the problem of scarcity.
B) Scarcity exists only when supply is insufficient to meet demand.
C) Scarcity exists only when a shortage exists.
D) Scarcity can be eliminated when a country becomes richer.
Answer: A
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
,4) The problem of economic scarcity applies
A) only in developed countries, because resources are scarce in these nations.
B) only in underdeveloped countries, because there are no productive resources in these nations.
C) only to an economy with an insufficient supply of money.
D) to the economies of all nations, regardless of their level of development.
Answer: D
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
5) In every economic system, choices must be made because resources
A) are unlimited, but human desires and wants are limited.
B) are limited, but human desires and wants are unlimited.
C) are unlimited, and so are human desires and wants.
D) are limited, and so are human desires and wants.
Answer: B
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
6) In the production of goods and services, trade-offs exist because
A) not all production is efficient.
B) society has only a limited amount of productive resources.
C) buyers and sellers often must negotiate prices.
D) human wants and needs are limited at a particular point in time.
Answer: B
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
7) Which of the following statements about economic scarcity is FALSE?
A) Scarcity occurs among the poor and the rich.
B) Scarcity only occurs if there are shortages and people wait in line to buy things.
C) Scarcity results from not having enough resources to produce all the things we want.
D) Scarcity results in the necessity to make choices.
Answer: B
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
, 8) Which of the following statements is FALSE?
A) Economic goods are available in desired quantities at a zero price.
B) A good is anything that gives satisfaction or happiness to individuals.
C) Services are intangible goods such as dry cleaning, hospital care, and restaurant meal
preparation.
D) Wants are unlimited and include all material and nonmaterial desires.
Answer: A
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
9) Which of the following statements about scarcity is TRUE?
A) Scarcity is no longer a problem for industrialized countries.
B) Scarcity exists in all societies.
C) Scarcity is a problem only for greedy people.
D) Scarcity is a problem only in countries that do not use markets to organize economic activity.
Answer: B
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
10) In 2006, hurricanes damaged many parts of Texas, destroying homes, businesses, schools,
and infrastructure. In strictly economic terminology, these hurricanes are said to have caused
A) scarcity, because the damages made food and shelter scarce.
B) scarcity, because some goods were difficult to get.
C) shortages, because supplies were cut off and goods were destroyed.
D) tradeoffs, because some areas of the country were damaged when others were not.
Answer: C
Diff: 2
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
Chapter 2 Scarcity and the World of Trade-Offs
2.1 Scarcity
1) Scarcity arises because
A) resources are finite and are inadequate to meet all human wants.
B) production of goods and services is always slow.
C) companies are slow to explore for new resources.
D) a large number of people live in poverty.
Answer: A
Diff: 2
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
2) Scarcity refers to
A) a shortage in a good or service.
B) the ability of society to consume all that it produces.
C) the inability of society to satisfy all human wants because of limited resources.
D) the inability of an individual to purchase a good or service due to her limited income.
Answer: C
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
3) Which of the following statements is TRUE about scarcity?
A) Both rich and poor people face the problem of scarcity.
B) Scarcity exists only when supply is insufficient to meet demand.
C) Scarcity exists only when a shortage exists.
D) Scarcity can be eliminated when a country becomes richer.
Answer: A
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
,4) The problem of economic scarcity applies
A) only in developed countries, because resources are scarce in these nations.
B) only in underdeveloped countries, because there are no productive resources in these nations.
C) only to an economy with an insufficient supply of money.
D) to the economies of all nations, regardless of their level of development.
Answer: D
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
5) In every economic system, choices must be made because resources
A) are unlimited, but human desires and wants are limited.
B) are limited, but human desires and wants are unlimited.
C) are unlimited, and so are human desires and wants.
D) are limited, and so are human desires and wants.
Answer: B
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
6) In the production of goods and services, trade-offs exist because
A) not all production is efficient.
B) society has only a limited amount of productive resources.
C) buyers and sellers often must negotiate prices.
D) human wants and needs are limited at a particular point in time.
Answer: B
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
7) Which of the following statements about economic scarcity is FALSE?
A) Scarcity occurs among the poor and the rich.
B) Scarcity only occurs if there are shortages and people wait in line to buy things.
C) Scarcity results from not having enough resources to produce all the things we want.
D) Scarcity results in the necessity to make choices.
Answer: B
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
, 8) Which of the following statements is FALSE?
A) Economic goods are available in desired quantities at a zero price.
B) A good is anything that gives satisfaction or happiness to individuals.
C) Services are intangible goods such as dry cleaning, hospital care, and restaurant meal
preparation.
D) Wants are unlimited and include all material and nonmaterial desires.
Answer: A
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
9) Which of the following statements about scarcity is TRUE?
A) Scarcity is no longer a problem for industrialized countries.
B) Scarcity exists in all societies.
C) Scarcity is a problem only for greedy people.
D) Scarcity is a problem only in countries that do not use markets to organize economic activity.
Answer: B
Diff: 1
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
10) In 2006, hurricanes damaged many parts of Texas, destroying homes, businesses, schools,
and infrastructure. In strictly economic terminology, these hurricanes are said to have caused
A) scarcity, because the damages made food and shelter scarce.
B) scarcity, because some goods were difficult to get.
C) shortages, because supplies were cut off and goods were destroyed.
D) tradeoffs, because some areas of the country were damaged when others were not.
Answer: C
Diff: 2
Topic: 2.1 Scarcity
Learning Outcome: Micro-1: Identify the basic principles of economics and explain how to
think like an economist
AACSB: Analytical thinking
