ECO 108 Hw 1 - ECO 108 Introduction to Economics Problem...

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1 ECO 108: Introduction to Economics Problem Set 1 Chapter 1 Professor: Eva Carceles-Poveda 1. Economics is best defined as the study of A. prices and quantities. B. inflation and interest rates. C. how people make choices under the conditions of scarcity and the results of the choices. D. wages and incomes. 2. The logical implication of the scarcity principle is that A. one will never be satisfied with what one has. B. as wealth increases, making tradeoffs becomes less necessary. C. as wealth decreases, making tradeoffs becomes less necessary. D. choices must be made. 3. Forest is a mountain man living in complete isolation in Montana. He is completely self-sufficient through hunting, fishing, and farming. He has not been in the city to buy anything in five years. One can infer A. the scarcity principle does not apply to Forest. B. Forest is not required to make choices. C. the scarcity principle still applies because more hunting means less fishing and farming. D. Forest is very satisfied. 4. The scarcity principle applies to A. all decisions. B. only market decisions, e.g., buying a car. C. only non-market decisions, e.g., watching a sunset. D. only the poor. 5. Whether studying the size of the U.S. economy or the number of children a couple will choose to have, the unifying concept is that wants are
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ECO 108 Hw 1 - ECO 108 Introduction to Economics Problem...

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