Because resources are scarce, we need to have economic _____.

Because resources are scarce, we need to have economic _____.

• A. inequality
• B. efficiency
• C. growth
• D. trade-offs

Answer: (B)

In the context of the American Free Enterprise System, the correct answer is economic efficiency. Resources are limited, which leads to the necessity of making the most effective use of those resources to meet the needs and wants of society. Economic efficiency refers to the optimal allocation of resources so that they can produce the maximum possible output with the least waste. When resources are scarce, prioritizing their use becomes critical. Economic efficiency ensures that resources are not wasted and are utilized in a manner that generates the highest levels of satisfaction and output for society. This aligns with the principles of a free-market system where individuals and businesses must constantly seek ways to improve productivity and minimize costs in order to remain competitive. Though other concepts like inequality, growth, and trade-offs relate to economic principles, they do not directly address the necessity that arises from resource scarcity as clearly as efficiency does. Inequality discusses the distribution of wealth and resources, growth refers to the increase in the economy's production capabilities, and trade-offs highlight the choices made when allocating scarce resources. However, it is economic efficiency that fundamentally expresses the importance of maximizing the use of those limited resources to benefit society as a whole.

In the context of the American Free Enterprise System, the correct answer is economic efficiency. Resources are limited, which leads to the necessity of making the most effective use of those resources to meet the needs and wants of society. Economic efficiency refers to the optimal allocation of resources so that they can produce the maximum possible output with the least waste.

When resources are scarce, prioritizing their use becomes critical. Economic efficiency ensures that resources are not wasted and are utilized in a manner that generates the highest levels of satisfaction and output for society. This aligns with the principles of a free-market system where individuals and businesses must constantly seek ways to improve productivity and minimize costs in order to remain competitive.

Though other concepts like inequality, growth, and trade-offs relate to economic principles, they do not directly address the necessity that arises from resource scarcity as clearly as efficiency does. Inequality discusses the distribution of wealth and resources, growth refers to the increase in the economy's production capabilities, and trade-offs highlight the choices made when allocating scarce resources. However, it is economic efficiency that fundamentally expresses the importance of maximizing the use of those limited resources to benefit society as a whole.