Practice test 1 - A fundamental economic assumption...

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Sheet1 Page 1 A fundamental economic assumption concerning the individual is Correct Answer: unlimited wants. An economy's production possibilities curve will shift outward as a result of Correct Answer: an increase in the level of technology. An inference from economic theory that can be subjected to real-world testing is Correct Answer: a testable hypothesis. Ceteris paribus is a Latin phrase used in economics that means Correct Answer: other things being unchanged. Economists are most likely to disagree over what policy to pursue because Correct Answer: they have the same models but different values and priorities. Microeconomics deals mainly with Correct Answer: the interactions of producers and consumers in individual markets. The word that best describes what economists study is Correct Answer: choice. The marginal approach is Correct Answer: concerned with incremental changes. The self-interest assumption is made by economists because Correct Answer: economists believe that human behavior is influenced by costs and benefits and the assumption allows eco The basic problem of scarcity means that
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