Multiple Choice
How can limited resources benefit the problem-solving capability in an organization?
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0. Basic Principles of Economics
Scarcity and Choice
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Which of the following contributes to the economic problem of scarcity?
A
Unlimited resources and limited wants
B
Limited resources and unlimited wants
C
Perfectly elastic supply
D
Government price controls
Verified step by step guidance1
Understand the economic problem of scarcity: it arises because resources are limited while human wants are unlimited.
Analyze each option by comparing it to the definition of scarcity.
Option 1: 'Unlimited resources and limited wants' contradicts scarcity because if resources were unlimited, scarcity would not exist.
Option 2: 'Limited resources and unlimited wants' matches the definition of scarcity, as it highlights the imbalance causing scarcity.
Options 3 and 4 (Perfectly elastic supply and Government price controls) relate to market conditions but do not directly cause scarcity.
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