Applied Economics Real Exam Question And
Answers Latest Update 2025 UPDATE GRADED A
Scarcity - ANS>- is the insufficiency of resources to meet the wants of the
consumers and insufficiency of resources for producers that hamper enough
production of goods and services.
Economics - ANS>- as a study, is the social science that involves the use of scarce
resources to satisfy unlimited wants.
Scarcity - ANS>- is a condition where there are insufficient resources to satisfy all
the needs and wants of a population.
- Scarcity may be relative or absolute
Relative Scarcity - ANS>- is when a good is scarce compared to its demand.
Example: Coconuts are abundant in the Philippines since the plant easily grows in
our soil and climate. However, coconuts become scarce when the supply is not
sufficient to meet the needs of the people.
Relative scarcity - ANS>- occurs not because the good is scarce per se and is
difficult to obtain but because of the circumstances that surround the availability
of the good.
Examples of Relative Scarcity - ANS>Bananas are abundant in the Philippines and
are being grown in a lot of regions around the country.
But when a typhoon destroys banana plants, the farmer has no banana to harvest,
then bananas become relatively scarce.
, Absolute Scarcity - ANS>- is when supply is limited.
Example: Oil is absolutely scarce in the country since we have no oil wells from
which we can source our petroleum needs, so we rely heavily on imports from
oilproducing countries like Iran and other Middle Eastern Countries.
Examples of Absolute Scarcity - ANS>Example: Cherries are absolutely scarce in
our country since we do not have the right climate to grow them and we have to
rely on imports for our supply of cherries. This explains why cherries are very
expensive in the Philippines
opportunity cost - ANS>- refers to the value of the best foregone alternative.
Example of Opportunity Cost - ANS>Example: When land is devoted exclusively to
the cultivation of rice, we give up an output of bananas or mangoes that we could
have planted on that land area.
Example: A producer who decides to transform all his leather into shoes, gives up
the chance to produce bags with that leather.
Example: A school teacher who could have worked in a bank gives up the salary
that she would have earned as a bank employee.
Example: A manager who quits his job in order to take up master's degree gives
up his salary as a manager. That salary is the opportunity cost.
Economic Resources - ANS>- also known as factors of production, are the
resources used to produce goods and services.
- These resources are, by nature, limited and therefore, command a payment that
becomes the income of the owner.
Land - ANS>- Soil and natural resources that are found in nature and are not
manmade.
Answers Latest Update 2025 UPDATE GRADED A
Scarcity - ANS>- is the insufficiency of resources to meet the wants of the
consumers and insufficiency of resources for producers that hamper enough
production of goods and services.
Economics - ANS>- as a study, is the social science that involves the use of scarce
resources to satisfy unlimited wants.
Scarcity - ANS>- is a condition where there are insufficient resources to satisfy all
the needs and wants of a population.
- Scarcity may be relative or absolute
Relative Scarcity - ANS>- is when a good is scarce compared to its demand.
Example: Coconuts are abundant in the Philippines since the plant easily grows in
our soil and climate. However, coconuts become scarce when the supply is not
sufficient to meet the needs of the people.
Relative scarcity - ANS>- occurs not because the good is scarce per se and is
difficult to obtain but because of the circumstances that surround the availability
of the good.
Examples of Relative Scarcity - ANS>Bananas are abundant in the Philippines and
are being grown in a lot of regions around the country.
But when a typhoon destroys banana plants, the farmer has no banana to harvest,
then bananas become relatively scarce.
, Absolute Scarcity - ANS>- is when supply is limited.
Example: Oil is absolutely scarce in the country since we have no oil wells from
which we can source our petroleum needs, so we rely heavily on imports from
oilproducing countries like Iran and other Middle Eastern Countries.
Examples of Absolute Scarcity - ANS>Example: Cherries are absolutely scarce in
our country since we do not have the right climate to grow them and we have to
rely on imports for our supply of cherries. This explains why cherries are very
expensive in the Philippines
opportunity cost - ANS>- refers to the value of the best foregone alternative.
Example of Opportunity Cost - ANS>Example: When land is devoted exclusively to
the cultivation of rice, we give up an output of bananas or mangoes that we could
have planted on that land area.
Example: A producer who decides to transform all his leather into shoes, gives up
the chance to produce bags with that leather.
Example: A school teacher who could have worked in a bank gives up the salary
that she would have earned as a bank employee.
Example: A manager who quits his job in order to take up master's degree gives
up his salary as a manager. That salary is the opportunity cost.
Economic Resources - ANS>- also known as factors of production, are the
resources used to produce goods and services.
- These resources are, by nature, limited and therefore, command a payment that
becomes the income of the owner.
Land - ANS>- Soil and natural resources that are found in nature and are not
manmade.
