Multiple Choice
What is the fundamental problem that both producers and consumers face in economics?
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0. Basic Principles of Economics
Scarcity and Choice
Multiple Choice
Based on the concept of scarcity, which of the following objects is likely to have the most value?
A
A common pebble found on most beaches
B
A standard pencil produced in large quantities
C
A rare diamond found in only one location in the world
D
A glass of tap water in a city with abundant water supply
Verified step by step guidance1
Understand the concept of scarcity: Scarcity means that a resource or object is limited in availability relative to the demand for it, which often increases its value.
Analyze each option in terms of scarcity: Consider how common or rare each object is and how easily it can be obtained.
Evaluate the common pebble: Since it is found on most beaches, it is abundant and not scarce, so its value is low.
Evaluate the standard pencil: Produced in large quantities, it is also abundant and not scarce, so its value is relatively low.
Evaluate the rare diamond: Found in only one location in the world, it is highly scarce, making it more valuable compared to the other options.
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