The Basic Goal of Economics Is to

question 107

Multiple Choice

The basic goal of economics is to

• A) control the effects of government action.
• B) determine how to distribute all that is produced in an economy.
• C) address the scarcity problem created because the population's desire for goods exceeds the ability to produce them.
• D) match limited resources to people's limited wants and needs.
• E) control tastes and wishes so that there will be enough resources to produce all the goods and services that people want.

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Definitions:

Elastic Demand

A condition in which the quantity demanded of a good or service greatly changes in response to changes in its price.

Inelastic Supply

A situation where the quantity of a good supplied by producers is relatively insensitive to changes in its price.

Tax Burden

The total amount of taxes that individuals or businesses are required to pay to government entities, often expressed as a percentage of income or profit.

Elasticity

A measure in economics to show how the quantity demanded or supplied of a good or service responds to a change in price.