Resources in the Economy, Opportunity Cost

Question 1

Outline economic resources.

Answer 1

Economic resources are used to create goods and services.

Question 2

Identify the differences of the 3 economic resources used to create goods and services.

Answer 2

The three economic resources are natural (like wood from forests, land to build on), Labour (intellectual and physical skills from human efforts) and capital (manufactured resources like machinery)

Question 3

Explain how scarcity influences opportunity cost.

Answer 3

Once you use a resource for a certain purpose, the alternatives that are given up are referred to as the opportunity cost.

Question 4

Discuss opportunity cost.

Answer 4

It encourages making decisions however the future gains cannot be accurately predicted.