Which of the Following Is the Best Definition of Economics

question 170

Multiple Choice

Which of the following is the best definition of economics?

• A) the study of how individuals and societies choose to use the scarce resources that nature and previous generations have provided
• B) the study of how consumers spend their income
• C) the study of how business firms decide what inputs to hire and what outputs to produce
• D) the study of how the federal government allocates tax dollars

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Definitions:

Market Price

The current value at which an asset or service can be bought or sold in a transaction between willing parties.

Shares

Portions of ownership in a company or finance asset, ensuring equitable division of profits through dividends, whenever they are declared.

No-Par Common Stock

Common stock issued without a par value, where the board of directors decides the selling price.

Stated Value

A value assigned to a security or asset which is not determined by market forces.