Scarcity Exists Because

question 69

Multiple Choice

Scarcity exists because

• A) human wants exceed the resources available to satisfy them.
• B) some individuals have low income.
• C) the costs of production are high.
• D) some people make bad economic decisions.
• E) people take too much leisure time.

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Definitions:

Utility Function

A mathematical representation of a consumer’s preference ordering over a choice set, used to describe how consumers allocate their income to maximize their satisfaction.

Risk Neutral

An attitude or preference indicating indifference between choices with uncertain outcomes, focusing instead on the expected values.

Risk Averse

A characteristic of preferring to avoid risk, inclining towards guaranteed outcomes over potentially higher-yielding but uncertain ones.

Income

The accumulation of funds, characteristically on a habitual basis, through work or investing.