Which of the Following Statements Regarding the Basic Economic Problem

question 122

Multiple Choice

Which of the following statements regarding the basic economic problem of scarcity is correct?

• A)The problem only exists in countries that are not highly industrialized.
• B)The problem is likely to disappear as production increases.
• C)The problem is sure to disappear as technology improves.
• D)The problem will exist as long as resources are available in limited amounts.
• E)The problem will disappear as a person's income falls.

---

Definitions:

Identical Products

Goods that are exactly the same in every feature, often used in industries where standardization is vital.

Beginning Inventory

The value of all the inventory held by a business at the start of an accounting period.

Equivalent Units

A concept used in cost accounting to standardize heterogeneous units of production, making them quantitatively comparable.

Equivalent Units

Equivalent units are used in cost accounting to represent the amount of work done during a period, expressed in terms of fully completed units.