Multiple Choice
Which of the following best describes the basic choices faced by all societies due to scarcity?
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0. Basic Principles of Economics
Scarcity and Choice
Multiple Choice
A society's ability to produce needed goods and services is permanently reduced if it:
A
implements a seasonal ban on certain imports
B
experiences a temporary decrease in labor productivity
C
faces a short-term disruption in transportation
D
depletes its non-renewable resources without developing alternatives
Verified step by step guidance1
Understand the concept of a society's productive capacity, which refers to its ability to produce goods and services over time.
Recognize that temporary events, such as a seasonal ban on imports, a temporary decrease in labor productivity, or short-term transportation disruptions, affect production only in the short run and do not permanently reduce productive capacity.
Identify that permanent reduction in productive capacity occurs when the society's fundamental resources or inputs are diminished without replacement or alternatives.
Focus on the impact of depleting non-renewable resources without developing alternatives, which means the society loses essential inputs for production permanently.
Conclude that among the options, only the depletion of non-renewable resources without alternatives leads to a permanent reduction in the society's ability to produce goods and services.
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