Class 9 Building Blocks in Economics: The Problem of Choice Mock Test (CBSE)

Topics in Building Blocks in Economics: The Problem of Choice

• Scarcity and choice
• What economics deals with
• What to produce, how to produce and for whom
• Planned economy
• Market economy
• Mixed economy

Building Blocks in Economics: The Problem of Choice practice questions with answers

1. Q1Multiple choice·1 mark
   Which of the following best describes the fundamental economic problem that gives rise to the study of choice?

   1. (a)Unlimited resources and limited human wants
   2. (b)Scarcity of resources in relation to unlimited human wants
   3. (c)Equal distribution of wealth across all societies
   4. (d)Complete elimination of opportunity costs in production
   Show answer and step marks

   1. Correct option: (b) Scarcity of resources in relation to unlimited human wants+1

   Answer: (b)
2. Q2Multiple choice·1 mark
   Why does the fundamental economic problem of scarcity universally confront both individuals and societies?

   1. (a)Human wants are unlimited, but resources to meet them are limited
   2. (b)Goods are unevenly shared, though there is enough to meet everyone's needs
   3. (c)Traders hoard goods, causing a shortage in the market for a short while
   4. (d)Prices keep rising, so people can afford fewer goods with the same income
   Show answer and step marks

   1. Correct option: (a) Human wants are unlimited, but resources to meet them are limited+1

   Answer: (a)
3. Q3Multiple choice·1 mark
   In which type of economic system are the fundamental economic decisions regarding what, how, and for whom to produce primarily determined by the forces of demand and supply?

   1. (a)Planned economy
   2. (b)Market economy
   3. (c)Command economy
   4. (d)Traditional economy
   Show answer and step marks

   1. Correct option: (b) Market economy+1

   Answer: (b)
4. Q4Assertion and reason·1 mark
   Assertion (A): Every economic choice involving scarce resources entails an opportunity cost represented by the value of the best alternative foregone. Reason (R): Human wants are virtually unlimited while society's resources are finite, thereby necessitating choices.

   1. (a)Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).
   2. (b)Both Assertion (A) and Reason (R) are true but Reason (R) is not the correct explanation of Assertion (A).
   3. (c)Assertion (A) is true but Reason (R) is false.
   4. (d)Assertion (A) is false but Reason (R) is true.
   Show answer and step marks

   1. Correct option: (a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A). Evaluate both statements: scarcity forces choices (Reason), and every choice incurs an opportunity cost (Assertion). Reason directly explains why opportunity costs exist.+1

   Answer: (a)
5. Q5Short answer·2 marks
   Briefly explain the central economic problems of 'what to produce' and 'how to produce' faced by an economy.
   Show answer and step marks

   1. What to produce: Deciding which goods and services to produce and in what quantities based on society's limited resources and needs.+1
   2. How to produce: Choosing the appropriate technique of production, such as labor-intensive or capital-intensive methods, to produce goods efficiently.+1

   Answer: What to produce: deciding which goods and services to produce, and in what quantities, with limited resources. How to produce: choosing the technique of production, labour-intensive or capital-intensive, to produce goods efficiently.
6. Q6Short answer·2 marks
   Every economy faces central economic problems due to the scarcity of resources. Briefly explain the central problems of 'What to produce' and 'How to produce'.
   Show answer and step marks

   1. What to produce: Deciding which goods and services to produce and in what quantities, given limited resources.+1
   2. How to produce: Choosing the technique of production, whether labor-intensive or capital-intensive, to produce goods efficiently.+1

   Answer: What to produce: deciding which goods and services to produce, and in what quantities, given limited resources. How to produce: choosing the technique of production, labour-intensive or capital-intensive, to produce goods efficiently.

More Class 9 Social Science (SST) mock tests