ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -product market. Bart has decided to buy some water balloons rather than get an extra milk at lunch. Choosing among economic alternatives is referred to as. Trade off.

Detailed explanation-2: -Examples of economic choice include the choice between different ice cream flavors in a gelateria, the choice between different houses for sale, and the choice between different financial investments in a retirement plan.

Detailed explanation-3: -Scarcity is one of the key concepts of economics. It means that the demand for a good or service is greater than the availability of the good or service. Therefore, scarcity can limit the choices available to the consumers who ultimately make up the economy.

Detailed explanation-4: -When economists refer to the “opportunity cost” of a resource, they mean the value of the next-highest-valued alternative use of that resource. If, for example, you spend time and money going to a movie, you cannot spend that time at home reading a book, and you can’t spend the money on something else.

Detailed explanation-5: -Our unlimited wants are continually colliding with the limits of our resources, forcing us to pick some activities and to reject others. Scarcity is the condition of having to choose among alternatives. A scarce good is one for which the choice of one alternative use of the good requires that another be given up.