Define scarcity and opportunity cost and explain how they influence economic choices.

• A. Scarcity means resources are finite relative to wants; opportunity cost is the next-best alternative foregone when a choice is made.
• B. Scarcity means all wants can be satisfied; opportunity cost is money spent.
• C. Scarcity means resources are abundant but misallocated; opportunity cost is the monetary cost of production.
• D. Scarcity means resources are finite but opportunity cost is zero.

Answer: (A)