Scarcity, choice and the allocation of resources：練習題

The fundamental economic problem of scarcity arises because:

In a centrally planned economy, the decision of 'what to produce' is primarily determined by:

A government decides to increase spending on healthcare by \(10\) billion by reducing its spending on education by \(10\) billion. In economic terms, the \(10\) billion of education services given up is known as:

Define the term scarcity as it relates to the fundamental economic problem.

Using a production possibility diagram, how is economic growth illustrated?

Contrast the allocation of resources in a free market economy versus a centrally planned economy.

Define the term opportunity cost and explain why every choice made by an individual consumer involves an opportunity cost when faced with limited income and unlimited wants.