11 mark
What causes economic agents to make choices?
limited needs and wants
the existence of finite resources
the existence of free goods
the market mechanism
Did this page help you?
The Nature of the Economic Problem (CIE IGCSE Economics)
Topic Questions
21 mark
What is the basic economic problem?
excess supply of goods and services
lack of profits
recession
scarcity of resources
Did this page help you?
31 mark
What is the cause of the economic problem facing all countries?
climate change and global warming
significant quantities of unemployed resources
uneven distribution of income and wealth
unlimited wants in relation to limited resources
Did this page help you?
41 mark
What is the basic problem facing all economies?
how to achieve a stable balance of payments
how to maximise tax revenues
how to reach full employment
how to use scarce resources
Did this page help you?
51 mark
What is the basic economic problem?
The scarcity of resources relative to human wants
The unlimited supply of resources to fulfil human needs
The efficient allocation of resources by the government
The equal distribution of wealth among all individuals
Did this page help you?
11 mark
Which of the following is not a consequence of the basic economic problem of scarcity?
The need for individuals and societies to make choices and trade-offs
The potential for economic growth and technological advancements
The emergence of opportunity cost in decision making
The ability to satisfy all human wants and needs without constraints
Did this page help you?
21 mark
Why does the basic economic problem of scarcity persist even in prosperous societies?
These societies have an overabundance of resources to meet all human wants
People in prosperous societies tend to have fewer material desires
Technological advancements have eliminated resource limitations
The unlimited nature of human wants outstrips available resources
Did this page help you?
31 mark
What is the relationship between scarcity and competition in the marketplace?
Scarcity reduces competition, leading to lower prices
Scarcity intensifies competition, driving up prices
Scarcity and competition are unrelated concepts in economics
Scarcity and competition both result from excessive consumer demand
Did this page help you?
41 mark
Which of the following economic systems is most directly affected by the basic economic problem of scarcity?
Market economy
Traditional economy
Command economy
Mixed economy
Did this page help you?
51 mark
Which of the following best explains how the basic economic problem of scarcity influences the production of goods and services?
Scarcity encourages businesses to produce only luxury goods to maximise profits
Scarcity necessitates the efficient allocation of resources to meet diverse consumer needs
Scarcity reduces the need for specialized labor as fewer goods can be produced
Scarcity ensures that businesses produce goods only for the wealthiest segment of society
Did this page help you?
11 mark
Why do consumers have to make choices when spending their income?
Advertising encourages consumer spending.
Consumers have unlimited incomes.
Consumer wants cannot all be satisfied with their income.
Not all products will be attractive to consumers.
Did this page help you?
21 mark
What identifies a finite resource?
The resource does not renew itself.
The supply of the resource is greater than demand.
There is no opportunity cost for the resource.
There is unlimited supply of the resource.
Did this page help you?
31 mark
What do economies aim to achieve in tackling the economic problem of scarcity?
equal balance between public and private sectors
equal reward for equal effort
increased competition in the use of resources
optimum allocation of finite resources
Did this page help you?
41 mark
Hospital services are provided by the government and paid for through taxation. People cannot always get the treatment they require because of long waiting lists.
Of what is this an example?
external cost
market system
perfectly inelastic supply
scarcity
Did this page help you?
51 mark
What is the primary reason for the existence of the basic economic problem of scarcity?
Inefficient production techniques used by firms
Rapidly increasing population and human wants
Inadequate government intervention in the economy
Overconsumption of goods and services by consumers
Did this page help you?