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THESE ARE SAMPLE QUESTIONS FROM ALL SIX (1 – 5) CHAPTERS. COVERS TEST-I CH 1: Limits Alternatives and Choices Multiple Choice Questions Economics; economic perspective 1. For economists, the word "utility" means: A) flexibility. B) rationality. C) pleasure and satisfaction. D) purposefulness. Answer: C 3. When economists say that people act in their self interest, they mean that individuals: A) look for and pursue opportunities to increase their utility. B) generally disregard the interests of others. C) are mainly creatures of habit. D) are unpredictable. Answer: A 7. Joe sold gold for $1000, he bought a year ago for $1000. He says, "I didn't lose money on investment." The economist tells him that he did, because he could have received a 3% if on a CD. This idea refers to 13. Rational behavior suggests that: 14. Economics involves marginal analysis because: 15. You should decide to go to a movie: A) if the marginal cost of the movie exceeds its marginal benefit. B) if the marginal benefit of the movie exceeds its marginal cost. C) if your income will allow you to buy a ticket. D) because movies are enjoyable. Answer: B 16. Marginal costs exist because: 17. The assertion that "There is no free lunch" means that:
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24. An economic hypothesis:
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