Skip to content

CA Foundation · Business Economics · Nature and Scope of Business Economics

Business Economics is sometimes called a science of decision-making under scarcity. Which feature of the subject does this description most directly highlight?

The description highlights choice among alternative uses of limited resources to achieve business objectives. Because resources are scarce, managers must weigh options and accept trade-offs. It has nothing to do with statutory books, and it does not assume certainty about the future.

  1. AChoice among alternative uses of limited resources to achieve business objectivesCorrect
  2. BThe need for a firm to maintain statutory books of account
  3. CThe fixed nature of resources, which removes the need for choice
  4. DThe certainty of future business conditions

Explanation

Scarcity means resources are limited relative to wants, so managers must choose among alternatives to meet objectives. This is the focus of the description. Resources are not free from limits, the future is uncertain, and bookkeeping is unrelated to this idea.

Did you get it right without looking?

One question tells you little. A timed set on Nature and Scope of Business Economics shows your real accuracy, how long you take and where you lose marks.

Practise Nature and Scope of Business EconomicsFree diagnostic mock

More Nature and Scope of Business Economics questions