Economic Problems: Scarcity, Choice, and Opportunity Cost

Flashcards testing concepts of economic scarcity, choice, and opportunity cost based on Puan Hazwani's scenario and the summary table for economic decision-making units.

Yang berikut manakah merupakan masalah ekonomi?

Why must a household make a choice when faced with scarcity of income?

A household must make a choice in order to maximize satisfaction.

In the scenario, what choice does Puan Hazwani make to address her economic problem?

She chooses to buy the watch priced at $RM200$ as her first best choice.

How is opportunity cost defined in the lecture notes?

Opportunity cost is defined as the second best choice that has to be foregone as a result of selecting the first best choice.

What is the opportunity cost for Puan Hazwani after choosing to purchase the watch?

The opportunity cost is the pair of shoes costing $RM170$.

According to the summary table, what are the primary economic problems (scarcities) faced by households, firms, and the government?

Households face a lack of income, firms face a lack of capital, and the government faces a lack of government revenue.

What are the main objectives (choices) of households, firms, and the government when resolving economic problems?

Households aim to maximize satisfaction, firms aim to maximize profit, and the government aims to maximize social welfare.

According to the summary table, what represents opportunity cost for a firm?

The second best output foregone.

According to the summary table, what represents opportunity cost for the government?

The second best development project foregone.