NATURE OF ECONOMIC PROBLEM D Which combination of terms gives the general definition of the economic problem? A bigger families, less food, starvation B falling supply, rising demand, shortage higher population, fewer jobs, unemployment D limited resources, unlimited wants, scarcity B What is the best example of the existence of the economic problem? A A government provides accommodation for all those who are homeless. B A police force has a lengthening list of unsolved crimes. C Janitha hands her homework in at the last permitted deadline. D Musa completes his journey without putting petrol in his car. Why is choice an important part of the basic economic problem? B Choice is necessary to achieve an equilibrium price. Limited resources have many uses. C Manufacturers produce a large variety of foods. D The market leads to an unequal distribution of goods. WWW.S 0455- Economics- Paper- 1 www.smartexamresources. comA Why will the economic problem never be solved? A People will always want more products than can be produced. B People will never agree on what is the best economic system. C There will always be an uneven distribution of income. D There will always be some people unemployed. C What is meant by the economic problem? A how to achieve efficiency with the existence of fixed resources and limited wants how to allocate resources between public and private sectors C how to balance unlimited wants against finite resources how to decide which methods to use to exploit all resources What is the basic economic problem facing all economies? RYEDUNNB.C D A inequality of income B insufficient resources C low economic growth D shortages of skilled labour C An unemployed worker accepts a job Which of the following is the opportunity cost of this decision? A the cost of travel to work B the income from the new job C the leisure time lost D the training in the new job C A hospital cannot treat all the people that need treatment. This is an example of A excess supply. B limited wants. C souCy. unlimited resources. 0455- Economics- Paper- 1 www.smartexamresources. com 2B Which terms summarse the nature of the economic problem? A finite resources and limited wants finite resources and unlimited wants C infinite resources and limited wants D infinite resources and unlimited wants A Which economic change would increase the problem of scarcity? A a decrease in fish stocks B a discovery of a new oil field C an increase in labour productivity D a reduction in waste EDOWUB. C A Economics is primarily concerned with allocating scarce resources for unlimited wants. B controlling unemployment and inflation. C determining the level of government expenditure. D studying how new wants and economic resources can be produced. Every business organisation faces the problem of satisfying wants. A What is the reason why wants are not fully satisfied? A An economy can only produce a limited amount of goods and services. B Governments cannot print enough money to pay for goods and services. C There is an over-production of goods and services by business organisations. D Workers are too skilled for the requirements of the jobs available. What is the basic economic problem facing all societies? D A how to achieve price stability B how to keep employment levels high C the extent to which incomes should be redistributed D what will be produced, how and for whom 0455- Economics- Paper- 1 www.smartexamresources.com 3