Multiple Choice Questions:
1. If a good is scarce,
a. It only needs to be limited.
b. It is not possible to produce any more of the good.
c. Our unlimited wants exceed our limited resources.
d. Our limited wants exceed our unlimited resources.
2. Which of the following is true of resources?
a. Their availability is unlimited.
b. They are the inputs used to produce goods and services.
c. Increasing the amount of resources available could eliminate scarcity.
d. Both b and c.
3. If scarcity were not a fact,
a. People could have all the goods and services they wanted for free.
b. It would no longer be necessary to make choices.
c. Poverty, defined as the lack of a minimum level of consumption, would also be eliminated.
d. All of the above would be true.
4. Economics is concerned with
a. The choices people must make because resources are scarce.
b. Human decision makers and the factors that influence their choices.
c. The allocation of limited resources to satisfy unlimited wants.
d. All of the above.
5. Which of the following would reflect self-interested behavior to an economist?
a. Worker pursuing a higher-paying job and better working conditions
b. Consumer seeking a higher level of satisfaction with her current income
c. Mother Teresa using her Nobel Prize money to care for the poor
d. All of the above
6. When economists assume that people act rationally, it means they
a. Always make decisions based on complete and accurate information.
b. Make decisions that will not be regretted later.
c. Do the best they can based on their values and information under current and future circumstances.
d. Make decisions based solely on what is best for society.
e. Commit no errors in judgment.
7. When we look at a particular segment of the economy, such as a given industry, we are studying
a. Macroeconomics.
b. Microeconomics.
c. Normative economics.
d. Positive economics.