What is the relationship between wants, factors of production, scarcity, and choices? Discuss the relationship for an individual and for a society
What will be an ideal response?
A person faces scarcity whenever his or her wants exceed what he or she can obtain using his or her resources. Because the person cannot fulfill all of his or her wants, the person is forced to choose which wants will be satisfied and which wants will remain unsatisfied. The same results hold true for a society. All societies face scarcity because people's wants are essentially infinite, so that the factors of production available are not sufficient to fulfill everyone's wants. Because of this fact, societies must make choices about which (and whose) wants will be satisfied and which (and whose) wants will remain unsatisfied.
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A nation that currently has a surplus in its capital account is called a
A) debtor nation. B) net lender. C) net borrower. D) current account surplus nation. E) creditor nation.
Refer to the above figure. The figure represents the consumption function for a consumer. Point C represents
A) autonomous consumption. B) positive saving. C) negative saving. D) zero saving.