The Statement That "There Is No Such Thing as a Free

question 97

Multiple Choice

The statement that "there is no such thing as a free lunch" means:

• A) there are no tradeoffs between economic goals.
• B) any production requires the use of scarce resources, and thus the sacrifice of another alternative.
• C) choices need not be made in rational behavior.
• D) scarcity only exists in poor societies.

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Definitions:

Housing and Financial Crisis

A period characterized by declining home prices, foreclosures, and a loss of value in financial instruments, leading to widespread economic instability.

World Prices

The prices of goods and services determined in the global market that influence the cost and availability of products internationally.

Aggregate Demand

The total amount of goods and services demanded in an economy at a given overall price level and time.

Aggregate Supply

The total quantity of goods and services that producers in an economy are willing and able to supply at different price levels.