Economy

What is the basic economic problem regarding technology and scarcity?

Technology increases output and efficiency, but cannot eliminate scarcity because human wants are unlimited and resources are finite.

Define opportunity cost.

Opportunity cost is the next best alternative forgone when a choice is made.

Give an example of an economic opportunity cost.

Choosing to buy a phone instead of a bicycle; the bicycle is the opportunity cost.

What non-economic factors can influence opportunity cost decisions?

Factors such as interest in a subject, entertainment preferences, peer influence, and long-term benefits.

What does geographical mobility of labor refer to?

The ability and willingness of labor to move from one region to another for employment.

List factors that affect geographical mobility of labor.

Language barriers, family ties, cost of moving, housing availability, and government support.

What are the positive effects of high geographical mobility?

Reduces unemployment in one region, fills labor shortages in another, and improves efficiency.

What is the Production Possibility Curve (PPC)?

The PPC shows the maximum possible combinations of two goods that can be produced with available resources and technology.

What does the PPC represent regarding scarcity and choice?

It illustrates that we cannot have unlimited goods (scarcity) and the choices we make about which goods to produce.

What happens to the PPC when there is growth in resources or technology?

The PPC shifts outward, indicating an increase in the production capacity.

What signifies an inward shift in the PPC?

A decline in production capacity caused by factors such as natural disaster, war, or loss of resources.

What is the significance of an outside point on the PPC?

An outside point represents a level of production that is unattainable with the current resources and technology.