Economic Reasoning
Why does scarcity exist even in wealthy societies?
Because wants are unlimited while resources are limited.
Why does scarcity force individuals, businesses, and governments to make choices?
Because not all wants can be satisfied at once.
Why did the Framers divide government into three branches?
To prevent concentration of power to one branch
Why is the Constitution considered a living document?
It can be amended and interpreted.
Why are rights meaningless without enforcement?
They cannot be protected.
Explain how opportunity cost affects everyday decision-making.
Choosing one option means giving up the next best alternative.
How is opportunity cost different from monetary cost?
It includes what is given up, not just money spent.
How does the Executive Branch enforce laws without creating them?
By carrying out laws passed by Congress.
How does popular sovereignty shape democratic government?
Power originates from the people.
Why does a market economy depend on consumer choice?
Supply responds to demand.
Why does a PPC curve represent efficiency rather than fairness?
It shows maximum production, not equal distribution.
Give an example of opportunity cost involving government spending.
Funding schools instead of highways
Explain how checks and balances protect liberty rather than slow government.
They prevent abuse of power.
Why is Rule of Law critical to limiting government authority?
It ensures leaders obey laws.
Why do governments regulate markets even in a free-market system?
To protect consumers and ensure fairness.
How would a major technological breakthrough affect production possibilities and why?
It shifts the PPC outward by increasing productivity.
Why is scarcity considered the foundation of economics?
It explains why choices, trade-offs, and prioritization exist.
Why is judicial review essential to constitutional government?
It ensures laws follow the Constitution.
Explain how federalism balances national unity with local control.
Power is shared between national and state governments.
How does the Constitution limit majority rule?
Through protected rights.
Why does a society operating inside its PPC indicate an economic problem?
Resources are underused or inefficiently allocated.
How does scarcity explain why wants never fully disappear in an economy?
As needs are met, new wants replace them.
How would government change if checks and balances were removed?
One branch could dominate and threaten rights.
Why did the Framers fear centralized power based on historical experience?
Abuse under monarchy and British rule.
How does risk differ between partnerships and corporations?
Corporations limit personal liability.