Economists assume that most people
a. act purposefully
b. make decision with some expected outcome in mind.
c. make choices that are not random and chaotic.
d. all of the above.
d
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Economic theory predicts that
(a) market forces impose stiff penalties on profits whenever enterprises discriminate against individuals on any basis other than productivity. (b) government intervention is required to combat discrimination. (c) market mechanisms and government interventions are weak in addressing issues of discrimination. However, government is relatively stronger. (d) discrimination is a necessary part of life private and public life.
When deciding whether to buy a second car, marginal analysis indicates that the purchaser should compare the:
a. benefits expected from two cars with the cost of both. b. additional benefits expected from a second car with the cost of the two cars. c. dollar cost of the two cars with the potential income that the cars will generate. d. additional benefits of the second car with the additional cost of the second car.
When an economist evaluates a positive statement, he or she is primarily
a. examining evidence. b. acting as a scientist. c. concerned with verifying how the world is. d. All of the above are correct.
Assume that the equilibrium price for a good is $5. If the market price is $10, a:
A. shortage causes the price to decline toward $5. B. surplus causes the price to rise above $10. C. shortage causes the price to rise above $10. D. surplus causes the price to decline toward $5.