1. Question #1
Why is the concept of ‘scarcity’ important in rich countries as well as poor ones?

2. Question #2
‘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.

3. Question #3
Use production possibility curve diagrams to explain the differences between actual output and potential output and between economic growth and economic development.

4. Question #4
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.

5. Question #5
Explain how the three basic economic questions would be answered in a free market economy and in acentrally-planned economy.

6. Question #6
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).