What Do Economists Mean When They State That a Good

question 160

Multiple Choice

What do economists mean when they state that a good is scarce?

• A) There is a shortage or insufficient supply of the good at the existing price.
• B) It is impossible to expand the availability of the good beyond the current amount.
• C) People will want to buy more of the good regardless of the price of the good.
• D) The amount of the good that people would like exceeds the supply freely available from nature.

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Definitions:

Fixed Asset

Long-term tangible property or equipment that a firm owns and uses in its operations to generate income, typically not expected to be converted to cash within a year.

Fixed Asset Turnover

A ratio that measures a company's ability to generate sales from its fixed-assets investments such as property, plant, and equipment.

Generating Sales

The process of creating revenue for a business through activities such as marketing, sales calls, and customer service.

Depletion Expense

The allocation of the cost of natural resources over their productive lives, recognizing the reduction in natural resource value as it is extracted and sold.