A regional healthcare authority is allocated a fixed annual budget of $million\pounds 50\text{ million}$ . It must choose between investing this budget in purchasing advanced oncology equipment or expanding preventative community care services.

Which of the following statements correctly applies the fundamental economic concepts of scarcity and opportunity cost to this scenario?

If the authority chooses to purchase the oncology equipment, the opportunity cost is the foregone benefit of the community care services.

By dividing the budget equally ( $million\pounds 25\text{ million}$ to each project), the authority avoids scarcity and incurs zero opportunity cost.

Preventative community care represents a free good because it reduces future demand on the hospital system.

The scarcity of the budget arises solely due to state-level market failure in public healthcare provision.

Which of the following statements correctly applies the fundamental economic concepts of scarcity and opportunity cost to this scenario?

If the authority chooses to purchase the oncology equipment, the opportunity cost is the foregone benefit of the community care services.

By dividing the budget equally ( $million\pounds 25\text{ million}$ to each project), the authority avoids scarcity and incurs zero opportunity cost.

Preventative community care represents a free good because it reduces future demand on the hospital system.

The scarcity of the budget arises solely due to state-level market failure in public healthcare provision.

1.1 Economic methodology and the economic problem

Question 15

Markscheme

1.1 Economic methodology and the economic problem

Question 15

Markscheme

1.1 Economic methodology and the economic problem

Question 15

1.1 Economic methodology and the economic problem Questions

1.1 Economic methodology and the economic problem

Question 15

1.1 Economic methodology and the economic problem Questions