Multiple Choice
Which of the following best describes the difference between a shortage and scarcity?
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0. Basic Principles of Economics
Scarcity and Choice
Multiple Choice
In a world characterized by scarcity, which of the following will we never be able to do?
A
Make choices about resource allocation
B
Face trade-offs between different goods and services
C
Experience opportunity costs
D
Satisfy all wants and needs for every individual
Verified step by step guidance1
Understand the concept of scarcity: Scarcity means that resources are limited while human wants are unlimited, which forces individuals and societies to make choices.
Recognize that because of scarcity, we must make choices about how to allocate resources efficiently among competing uses.
Acknowledge that facing trade-offs is inevitable since choosing more of one good or service means having less of another.
Understand opportunity cost as the value of the next best alternative foregone when a choice is made, which arises directly from scarcity and trade-offs.
Conclude that due to scarcity, it is impossible to satisfy all wants and needs for every individual, making this the correct statement that we will never be able to do.
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