Question 1 [10] MULTIPLE-CHOICE QUESTIONS Each of the following sub-questions contains one statement but with multiple possible answers. Only one of the answers is correct. Read each statement very carefully and then decide which one of the options is the correct one. In your answer book, write down only the sub-question number and next to it the letter that represents the answer you have selected. Example: If you believe that for sub-question 1.11 option C is correct, then write down: 1.11 C. 1.1 If we were to say that two variables are positively related, this means that _____ A. an increase in one variable can be associated with an increase in the other. B. the relationship between the two is purely random. C. the relationship between the two would graph as a line sloping downwards. D. the relationship between the two would graph as a horizontal line. 1.2 Which one of the following is not a basic economic system? A. Market system B. Mixed system C. Traditional system D. Monetary system 1.3 Which one of the following does not represent the income of a factor of production? A. Rent B. Wages C. Profit D. Money 1.4 If the cross elasticity of demand for two goods, A and B, is +5.0, then this implies that these goods must be _____ A. luxuries. B. substitutes. C. complements. D. necessities. 1.5 A budget line illustrates the _____ A. prices of two goods. B. ordinal utility of two goods. C. affordable combinations of two goods. D. cardinal utility of two goods. A