Section+One+Questions+(Introduction+to+Economics)

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__﻿SECTION ONE QUESTIONS (INTRODUCTION TO ECONOMICS)__
1. Why is the concept of ‘scarcity’ important in rich countries as well as poor ones? 2. The choice between military products and the provision of health care illustrates the problem of ‘opportunity cost’. Explain the nature of the problem, using a production possibility frontier to help you. 3. Explain why countries with different economic systems face the same fundamental economic problems. 4. ‘Economics is primarily concerned with the allocation of scarce resources which have alternative uses’. Use a production possibility curve to help you explain this statement. 5. Use production possibility curve diagrams to explain the differences between actual output and potential output and between economic growth and economic development. 6. Explain what is meant by a production possibility curve and use a production possibility curve diagram to explain the concepts of scarcity, efficiency, choice and opportunity cost. 7. Explain how the three basic economic questions would be answered in a free market economy and in a centrally-planned economy. 8. Using a production possibility curve (PPC) diagram, explain the relationship between the economic concepts of economic goods, factors of production and opportunity cost. 9. With reference to the concept of economic growth, explain the difference between a movement along an existing production possibility curve (PPC) and an outward shift in a production possibility curve (PPC).