Economic Evaluation Text Book Chapter 1

A. Multiple Choice

1. A
2. C
3. E
4. C
5. D
6. B
7. D
8. A
9. B
10. A

B.  Essay

1. State and explain the reasons behind the scarcity of resources and goods/services
2. In your own words, explain what scarcity is
3. Explain resources allocation using the PPF curve
4. Explain how to make choices rasionally
5. What are the different kinds of human need? please explain
6. Explain about the fundamental economic problem are
7. Compare between mixed economic system and centralized economic system
8. What are the advantageous and disadvantageous of centralized economic system? please explain
9. In your opinion, does traditional economic system still exist in this world? elaborate
10. In your opinion, what economic system is adopted in Indonesia? elaborate

Answer

1. *Natural disasters, like tsunami, earthquake, and flood, destroy the resources, so that they cannot be utilized.*Wars also one of the main reason behind carcity. Civil war in Sudan, for instance, has caused famine and starvation. *Human behaviour toward natural resources also has impact on resources scarceness, which in turn can cause scarcity of goods and services. Illegal logging is one of the examples. *The various arrays of needs. Human needs are continuously developed. It is a human nature, that we, humans, always feel insufficient
   
2. Scarcity is circumstances in which existing resources or to offer any society to all its citizens is always less than or not comparable to what they want.
3.  
4. *Distinguish between needs and wants. *Identify the reason of the need fulfilment. *Do the cost and benefit analysis in fulfilling the needs. *Realising the opprtunity cost. If one need is fulfilled then its opportunitycost is the other need that cannot be fulfilled because of it.
   
5. *Primary needs, * Secondary needs, *Tertiery needs, *Physical needs, *Spiritual needs, *Currents needs, *Future needs, *Individual needs, *Public needs.
6. Fundamental economic problems is the prime challenges faced by all economic. They are: *What to be produced, *How to produced, *For whom the goods/services are produced 
7. *Mixed economic system is economi system that is controlled and supervised by the government but the people still have ample freedom to determine the economic activity that you want to run. *Centralized Economic system is based on the direction from central authority or central government
8. *The deficiences: in this system, there is no individual ownership. Evrything is owned by government. Since all economic activities have been planned and controlled by the government, the people are usually passive and do not have the freedom to express themselves. *The excess: This system is opposed to market mekanism as applied by capitalist
   
9. 
   
10.