DHS 2025 The Central Economic Problem

The Central Economic Problem DHS Economics 2025 DUNMAN HIGH SCHOOL (SENIOR HIGH) ECONOMICS UNIT 2025 YEAR 5 H1/H2 THE CENTRAL ECONOMIC PROBLEM Tutorial Package 1. A country with a low income per head discovers large quantities of oil, which eventually makes everyone better off. Why is the basic economic problem of scarcity not solved by this discovery? A) People may not get jobs in the oil industry. B) People’s wants are always changing and increasing. C) Prices of oil can fluctuate on the world market. D) Production of oil can damage the environment. ( ) 2. Which economic change would increase the problem of scarcity? A) A decrease in fish stocks B) A discovery of a new old field C) An increase in labour productivity D) A reduction in waste ( ) 3. What, according to the definition of opportunity cost, is sacrificed when a decision is taken? A) An identical alternative B) Any possible alternative C) The least valuable alternative D) The value of the next best alternative ( ) 4. A project was undertaken to build Long Island in Singapore to address rising sea levels and enhance coastal protection. What was the opportunity cost to the local economy? A) The expenses the government had to pay for the project B) The cost of the building materials C) The other infrastructure projects not built as a result D) The wages of the workers ( )

The Central Economic Problem DHS Economics 2025 5. Emma carefully planned how she would spend her holiday based on her preferences: First choice A holiday trip to Kuala Lumpur by flight Second choice Completing a 36km Singapore Coast -to-Coast Trail Hike Third choice Attending a movie marathon Fourth choice Completing a 2,000-piece puzzle Unfortunately, the airline cancelled the flight due to technical issues, and she injured her foot, which prevented her from completing the hike. As a result, she decided to attend the movie marathon. What was the opportunity cost of attending the movie marathon? A) The holiday in Kuala Lumpur B) Completing the trail hike C) Completing a 2,000-piece puzzle D) Not doing anything during her holiday ( ) 6. A production possibilities curve shows the various combinations of output: A) Consumers would like to consume. B) Producers would like to produce. C) An economy can produce. D) An economy should produce. ( ) 7. If an economy can produce various combinations of food and shelter along a production possibilities curve (PPC), then if we increase the production of shelter along the PPC, which of the following is true? A) We also increase the production of food. B) We must decrease the production of food. This foregone food production represents the opportunity cost of the increase in shelter. C) We cannot change the production of food. D) The concept of opportunity cost does not apply along PPC. ( ) 8. Continuing with question 7, if we continue to sh