hw__1 - 1 Scarcity a exists only during a recession b...

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1. Scarcity a. exists only during a recession. b. ensures people become satisfied with less than they want. c. requires people to make choices . d. exists only in some countries. e. affects only poor people. 2. Which of the following is not considered to be a resource? a. Money wages b. A university professor c. A hammer in a carpenter's shop d. A coal mine e. An offshore oil well 3. The decision to forego wearing a seat belt when driving a car is a. not rational because for most people the benefits of wearing the belt exceed the costs of wearing it. b. proof that people are not rational all the time. c. rational to those who make that decision because to them the cost of wearing the belt exceeds the benefits of wearing it . d. proof that some people make the wrong decision. e. proof that the government should exert more control over drivers. 4. Which of the following is a normative statement? a. Higher prices for cigarettes discourage people from buying cigarettes. b. If the price of eggs decreased, people would probably buy more eggs. c. A higher interest rate encourages people to save more. d. Higher taxes on cigarettes are good because they discourage people from buying cigarettes. e. Lower interest rates encourage people to borrow. 5. Aunt Flora has discovered that her sick potted philodendron plant responds well to a certain type of fertilizer. She therefore applies the fertilizer to the many flowers in her garden to make them grow better. All but the philodendron die. Aunt Flora's mistake is called a. association as causation . b. the fallacy of composition. c. ceteris paribus. d. the self interest hypothesis. e. irrational behavior. 6. If society begins by producing 3 units of X and 4 units of Y, and then alters production so that it is now producing 4 units of X and 4 units of Y, and the quantity and quality of resources were unchanged and technology did not change, then we know that a. society has moved along the PPC. b. 3 units of X and 4 units of Y are a combination best represented by a point inside the
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PPC. c.
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This note was uploaded on 04/03/2008 for the course ECN 211 taught by Professor Kingston during the Spring '08 term at ASU.

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hw__1 - 1 Scarcity a exists only during a recession b...

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