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PE1 - Practice Exam 1 Multiple Choice Identify the letter...

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Practice Exam 1 Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 1. Economics deals primarily with the concept of b. scarcity. ____ 2. Efficiency means that a. society is getting the most it can from its scarce resources. ____ 3. When government policies are being designed, b. there is usually a tradeoff between equity and efficiency. ____ 4. The opportunity cost of an item is b. what you give up to get that item. ____ 5. College-age athletes who drop out of school to play professional sports a. are making a bad economic decision, since they can't play forever. b. are unaware of their opportunity cost of attending college. c. underestimate the value of a college education. d. are well aware that their opportunity cost of attending college is very high. ____ 6. People make decisions at the margin by ____ 7. A marginal change is ____ 8. Economists understand that people respond to ____ 9. One effect of a government imposed seat belt law has been a. fewer pedestrian deaths. b. safer driving. c. an increase in the number of accidents. d. that everyone now wears seat belts. ____ 10. Which is the most accurate statement about trade?
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____ 11. If Canada is better than the U.S. at producing hockey sticks, but the U.S. is better than Canada at producing roller blades, ____ 12. In a market economy, ____
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