Macro_Chapter_1_study_guide_questions_13e - Macro chapter 1...

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Macro chapter 1 study guide questions Multiple Choice Identify the choice that best completes the statement or answers the question. ____ 1. Which of the following is true? a. Scarcity and poverty are basically the same thing. b. Poverty implies that some basic level of need has not been attained. c. Scarcity is the result of prices being set too high. d. All of the above are true. ____ 2. Economics is the study of how a. individuals make choices because of scarcity. b. to succeed in business. c. to make money in the stock market. d. the morals and values of people are formed. ____ 3. When an economist states a good is scarce, she means that a. production cannot expand the availability of the good. b. it is rare. c. desire for the good exceeds the amount that is freely available from nature. d. people would want to purchase more of the good at any price. ____ 4. When economists say an individual displays economizing behavior, they simply mean that the individual is a. making a lot of money. b. purchasing only those products that are cheap and of low quality. c. learning how to run a business more effectively. d. making choices to gain the maximum benefit at the least possible cost. ____ 5. "The national debt is too large. The government must stop spending so much money." This statement is a. a normative statement. b. a positive statement. c. a testable hypothesis. d. both b and c. ____ 6. Which of the following is a guidepost to economic thinking? a. The value of a good can be objectively measured. b. Individuals should never make a decision without having complete information. c. Incentives matter. d. Goods are scarce for the poor but not for the rich. ____ 7. Competitive behavior a. occurs as a reaction to scarcity. b. occurs only in a market system. c. occurs only when the government allocates goods and services. d. always generates waste. ____ 8. In economics, the statement, "There is no such thing as a free lunch," refers to which of the following? a.
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Macro_Chapter_1_study_guide_questions_13e - Macro chapter 1...

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