True
Scarcity or shortage is the main problem in economics. When there are not enough resources to produce all the goods and services which consumers want ten the shortage is said to be occurred and it creates chaos in the society.
True
Scarcity forces people to make choices by making them decide which options are most important to them. When there are limited goods and services for unlimited wants, People need to make choices in order to satisfy the wants that are most important to them and discard the choices which are not important to them. So in this way we can say that Scarcity forces people to make choices.
True
When people make choices about important things and ordinary things then they are likely supposed to focus on the hierarchy of the list where they categorize things and put more important things on the top of the list and then coming down to the ordinary things. All depends upon money and demand that is why we can say that economics is responsible for decision making process and it tells us what to do next.
False
Actually consumer in economics means Individuals who uses goods or products for personal use and not for resale or profit. Since this definition fits on individuals but not on business so we can say that business does not come under the category of consumers. In other words the consumer is the one who pays something to consume goods and services produced. Families are also example of consumers.
True
Opportunity cost is benefit, profit, or value of something that must be given up to acquire or achieve something else. SO it means that we are wasting something to get something else. For example spending time and money going to a movie, we cannot spend that time at home reading a book, and we can't spend the money on something else. So this leaves us to make choices and if it totally depends on our own experience to select the best among options.
False
A decision making grid or DMG is a list of values in rows and columns that allows an analyst to identify, analyze, and rate the performance of relationships between sets of values and information. It is a useful technique to use for making the best decision among many options. This is a computer program but this is not used for studying consumer habits.
True
As discussed earlier DMG tool is used to determine the best decision among many choices by analyzing the set of data in economics so we can say that this tool provides us with the quantity of profit that a business can earn in the market because selecting the best decision always produces best results.
True
Making choices mean that one alternative is selected over another. So is the example of opportunity cost which states that one opportunity must be given up to avail the other one. So in economics we always lose something to get another thing. Everything selection of choice has got its own cost.
Opportunity cost
Opportunity cost is the loss of other alternatives when one alternative is chosen. As the family has chosen to buy a refrigerator instead of taking summer vacation so they are losing the opportunity of summer vacation to avail the opportunity of purchasing the refrigerator. Both of them cannot be done at the same time if there is scarcity.
Scarcity and limited resources both are the causes of economic problems. We run into scarcity because resources are limited and we have unlimited wants. Therefore, we have to choose among choices. Since human wants are unlimited but the means to satisfy them are limited therefore every choice cannot be fulfilled and hence a problem arises.
