Chapter 1. Economic Problems

A. Multiple choice

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

B.Essays

1. State and explain the reason behind the scarcity of resources and goods/services
2. In your own words,explain what scarcity is
3. Explain resource allocation using the PPF curve
4. Explain how to make choices rationally
5. what are the different kinds of human needs?Please explain
6. Explain about the fundamental economic problems are
7. Compare between mixed economic system and contralized economic system
8. What are the advantageous and disadvantageous of centralized economic system?Pleaseexplain
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 reasons behind scarcity.Civil War in Sudan, for instance, has caused famine and starvation
-Human behaviour toward natural resources also has impact on resource 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, human, always feel insufficient.
2. Scarcity is a situation where existing resources or in any public offer to all its citizens but still less than or not comparable to what they want.
3. Production possibility curve is a curve that describes the various combinations of output that may be produced by an economy with production factors (resources) are available.
4. a. identify whether that will be fulfilled is the need or desire.
b. identify drivers to meet demand.
c. do the costs and benefits in meeting needs.
d. realizing the opportunity cost that if a need is filled with opportunity cost of other needs unmet
5. - Needs according to the intensity of their usefulness
- Needs according to the form and nature
- Needs according to the time
- Needs according to the subject that requires
6. principal economic problem is the main problem faced by every economy. basically the main economic problem is almost identical in every economy is the principal economic problems are as follows:
1. what should be produced?
2. how to produce it?
3. to whom the goods or services produced?
7. mixed economic system is an economic system that is controlled and supervised by the government but the society still had ample freedom to determine the economic activities that wish to run while the centralized economic system is an economic system is telaksana under central command authority or central government.

8. Goodness of centralized economic system are: The government is easier to control inflation, unemployment and other economic issues, Domestic goods market running smoothly, Government may intervene in the case of price formation, Relatively easy to make income distribution, Rarely economic crisis. The weakness of the centralized economic system are : Turning off individual initiative to advance, It often happens that harm the public monopoly, Communities do not have freedom in choosing resources.
9. Yes, someplace still exist in this world, because there are tribe living in hiterland usually adopts the traditional economic syste. 
10. Basically the mixed economic system or economic system of democracy with competition control, seems an economic system is best suited to manage the economy in Indonesia, however the recent Indonesian economic system increasingly skewed to the liberal and capitalist economy that is characterized by rapid foreign capital Mauk to Indonesia and BUMN and BUMD that have been privatized. The trend is driven the swift currents of globalization and the demise of communism in Eastern European countries applying economic socialism-komunistik.