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Test Bank For Essential Foundations of Economics 7 th
Edition By Robin Bade Michael Parkin (All Chapters, 100% Original Verified, A+ Grade) 1 / 4
1 Copyright © 2015 Pearson Education, Inc.Essential Foundations of Economics, 7e (Bade/Parkin) Chapter 1 Getting Started 1.1 Definition and Questions 1) Scarcity exists because
- human wants exceed the resources available to satisfy them.
- some individuals have low income.
- the costs of production are high.
- some people make bad economic decisions.
- people take too much leisure time.
Answer: A
Topic: Scarcity
Skill: 1 - analytical
Section: Checkpoint 1.1
Status: Old
AACSB: Reflective thinking
2) Scarcity
- is the inability to satisfy all our wants.
- leads to higher prices.
- applies only to people living in poverty.
- is not something that affects very rich people.
- used to exist everywhere but has been eliminated in advanced economies.
Answer: A
Topic: Scarcity
Skill: 1 - analytical
Section: Checkpoint 1.1
Status: Old
AACSB: Reflective thinking
3) Scarcity requires that we
- produce efficiently.
- learn to limit our wants.
- have the most rapid economic growth possible.
- have unlimited resources.
- make choices about what goods and services to produce.
Answer: E
Topic: Scarcity
Skill: 1 - analytical
Section: Checkpoint 1.1
Status: Old
AACSB: Reflective thinking 2 / 4
2 Copyright © 2015 Pearson Education, Inc.4) Scarcity means that
- what we can produce with our resources is greater than our material wants.
- resources are unlimited.
- wants are greater than what we can produce with our resources.
- governments must make up for shortages in resources.
- choices made in self-interest cannot be the same as those made in the social interest.
Answer: C
Topic: Scarcity
Skill: 1 - analytical
Section: Checkpoint 1.1
Status: Revised
AACSB: Reflective thinking
5) Because human wants are insatiable and unlimited while available resources are limited, people are said to face the problem of
- scarcity.
- why to produce.
- macroeconomics.
- microeconomics.
- social interest versus self-interest.
Answer: A
Topic: Scarcity
Skill: 1 - analytical
Section: Checkpoint 1.1
Status: Old
AACSB: Reflective thinking
6) Which of the following statements best describes the study of economics? Economics studies how
- to organize production so that scarcity does not occur.
- firms make profits.
- we make choices in the face of scarcity.
- to create incentives so that scarcity does not exist.
- businesses reach decisions.
Answer: C
Topic: Scarcity
Skill: 1 - analytical
Section: Checkpoint 1.1
Status: Old
AACSB: Reflective thinking 3 / 4
3 Copyright © 2015 Pearson Education, Inc.7) Scarcity forces people to
- choose among available alternatives.
- cheat and steal.
- be unwilling to help others.
- live at a low standard of living.
- consume as much as they can as quickly as they can.
Answer: A
Topic: Scarcity
Skill: 2 - conceptual
Section: Checkpoint 1.1
Status: Old
AACSB: Reflective thinking
8) Scarcity means we must
- consume less.
- produce less.
- make choices.
- earn more.
- work more.
Answer: C
Topic: Scarcity
Skill: 1 - analytical
Section: Checkpoint 1.1
Status: Old
AACSB: Reflective thinking
9) What is the reason that all economic issues and problems occur?
- All nations use some form of money to buy and sell goods and services.
- Humans are always wasteful and inefficient in production and consumption.
- Powerful governments are able to control production and consumption.
- Human wants exceed the resources available to satisfy them.
- People seek only their own self-interest.
Answer: D
Topic: Scarcity
Skill: 2 - conceptual
Section: Checkpoint 1.1
Status: Old
AACSB: Reflective thinking
10) The study of economics is best described as a study of
- the factors that influence the stock and bond markets.
- capitalism.
- the choices made in producing goods and services.
- coping with scarcity, and choices made as a result of scarcity in a society.
- how people earn a living.
Answer: D
Topic: Definition of economics
Skill: 1 - analytical
Section: Checkpoint 1.1
Status: Old
AACSB: Reflective thinking
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