Economic test.docx - Name Date 1 Recall Chapter 1's opening story about the British sea captains and the convicted felons In what way were incentives

Economic test.docx - Name Date 1 Recall Chapter 1's opening...

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Name: __________________________ Date: _____________ 1. Recall Chapter 1's opening story about the British sea captains and the convicted felons. In what way were incentives used to solve the problem of the high mortality rate on board the ships? 2. Recall Chapter 1's opening story about the British sea captains and the convicted felons. Instead of paying the sea captains for each prisoner placed on board the ships in Great Britain, an economist suggested: 3. In his book The Wealth of Nations, Adam Smith claimed that individuals: 4. In the opening story, the payment to captains of prisoner transport ships for each convict who arrived in Australia instead of for each convict who boarded the ship: 6. Every day people rely on the work of others to provide us with food, clothing, and shelter. These people work for our benefit because: 7. Economists think that people are self-interested: 8. The basic postulate of economics indicates that changes in incentives influence the: 9. Economists assume that people respond to: 10. Adam Smith wrote, “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest.” He meant that: 11. Which financing method for transporting prisoners from point A to B will result in the greatest number of prisoners surviving the trip? Assume there are 50 prisoners being transported.B) The ship's captain is paid $100 by the government for every live prisoner that is unloaded at Point B. 12. The main incentive for business activity is: 13. Suppose the United States government wants to encourage individuals to save more of their income.The easiest way for thegovernment to realize this goal is to: 14. Many companies pay their sales employees based on commissions—the more they sell, the more they get paid. This practicehighlights the role of:
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