Scarcity Means That

question 45

Multiple Choice

Scarcity means that:

• A)our desire for a good exceeds the amount that is freely available.
• B)at the current market price there is a shortage of the good.
• C)we are unable to find a particular good in any of the stores we visit.
• D)a particular good is difficult to produce.

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Definitions:

Days' Sales

A financial metric that measures the average time it takes for a company to turn its inventory into sales.

Receivables

Money owed to a company by its customers from sales or services rendered, recorded as an asset on the balance sheet.

Inventory

The total amount of goods and materials held by a company, intended for sale or production.

Payables

Short for accounts payable; money owed by a company to its suppliers or creditors for products and services received but not yet paid for.