How does the study of economics depend upon the phenomenon of scarcity?
Because economics is the study of how society allocates its scarce resources, if there were no scarcity, there would be no need for economics. Everyone could have all the goods and services they wanted. No one would have to make decisions based on tradeoffs, because there would be no opportunity cost associated with the decision. (It is difficult to conceive of a situation where time is not scarce, however).
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In the above figure, a price floor of $4
A) leads to a shortage. B) leads to a surplus. C) has no effect. D) shifts the demand curve leftward.
The observed correlation between baldness and heart disease demonstrates that:
A) being bald causes a man to have heart disease. B) being bald actually makes heart disease less likely. C) bald men are generally unreliable. D) there is probably some other factor that causes both baldness and heart disease.