Scarcity

question 40

Multiple Choice

Scarcity:

• A) does not exist in the real world.
• B) is experienced only by individuals.
• C) is unique to business.
• D) limits society's productive capacity.

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Definitions:

Capacity Utilization

A measure of how fully an economy's productive capacity is used, typically expressed as a percentage of total potential output.

Production Possibilities Frontier

An economic model that depicts the maximum possible output combinations of two goods or services an economy can achieve when all resources are fully and efficiently utilized.

Full Employment

An economic situation where all available labor resources are being used in the most efficient way possible, typically characterized by low unemployment.

Entrepreneurial Ability

The innovation and risk-taking skills that a person possesses to create and manage a business successfully.