Question

Alan is a retired economist who enjoys building toy trains for his grandkids. He uses a
workbench and tools from his garage, lumber he bought from the lumber store for $10, and
varnish and paint he had left over from another project last year. Since a retired economist is
always an economist, which of the following statements does he make about building toy trains?

Answer 1

Answer: c. I’m using scarce resources to build the toy trains.

Explanation:

A scarce resource is usually termed as one that has less quantity than what it is required for. Scarce resources are synonymous with factors of production being labor, capital, land or entrepreneurship and are considered scarce as they usually have a limited availability juxtaposed with their potential use. Alan's resources can therefore considered scarce.

Answer 2

Answer:

C) I’m using scarce resources to build the toy trains.

Explanation:

In economics, all resources are scarce. Even the richest person in the world or the richest country or the richest company, have a limited amount of money. And that limitation applies to all resources, and the singe resource that is limited equally to everyone is time.

Economics is the science that studies how to allocate scarce resources efficiently.