Question
Juan owns a toy company that makes both electric bicycles and gaming consoles. The electric bicycles and gaming consoles use the same computer chips. Unfortunately, the only factory in the world that makes these computer chips was damaged in a hurricane and cannot produce more. Fortunately, Juan has a small stockpile of the computer chips, but not enough to continue making both electric bicycles and gaming consoles. Juan chooses to stop making the electric bicycles and to use the remaining computer chips to make only gaming consoles. Juan's decision to use the few computer chips that he has left to make gaming consoles instead of electric bicycles best illustrates which economic concept?
a. command economy decision-making
b. distribution of scarce resources
c. economic surplus
d. production possibilities frontier
a. command economy decision-making
b. distribution of scarce resources
c. economic surplus
d. production possibilities frontier
Answers
GPT-4o mini
Juan's decision to use the remaining computer chips to make gaming consoles instead of electric bicycles best illustrates the concept of **b. distribution of scarce resources**.
In this scenario, Juan is faced with a limited supply of computer chips (a scarce resource) and must decide how to allocate them between two competing uses (electric bicycles and gaming consoles). By choosing to focus on gaming consoles, he is demonstrating the need to distribute scarce resources in a way that reflects his priorities and market demands.
In this scenario, Juan is faced with a limited supply of computer chips (a scarce resource) and must decide how to allocate them between two competing uses (electric bicycles and gaming consoles). By choosing to focus on gaming consoles, he is demonstrating the need to distribute scarce resources in a way that reflects his priorities and market demands.