Question

5) The economic way of thinking

A) studies facts without using theories.

B) explains how social order and cooperation emerge from the actions of individuals.

C) is free of biases and assumptions.

D) includes all of the above features.

6) Competition would probably be abolished if society could find a way to abolish

A) inequality.

B) scarcity.

C) money.

D) economists.

7) Rich and poor people have which of the following in common?

A) Scarcity

B) Economizing behavior

C) Pursuing the plans and projects in which they are interested

D) All of the above.

8) Economic theory assumes people

A) rarely act generously.

B) consistently act selfishly.

C) make choices based on a comparison of cost and benefits.

D) are fundamentally complex. Therefore, no general theory can be deduced to make sense out of the decisions and choices people make.

9) In the economic way of thinking, private property rights provide people with

A) rules of the game.

B) dependable information.

C) incentives.

D) all of the above.

10) The economic system of the United States

A) was designed by mercantilists and capitalists.

B) was designed by the framers of the U.S. constitution.

C) was designed to maximize individual freedom.

D) was the result of human intentions but not anyone's design.

Answer 1

5) B . explains how social order and cooperation emerge from the actions of individuals

Economy is very much affected by the main factors supply and demand and deals with the monetary aspects in an economy due to which the country grows and flourishes. Thus, the people are base and cause for the growth. Thus it explains the social order and cooperation from people and their actions.

6) B. Scarcity

If scarcity is abolished there is no need to competition as the things will be available in abundance and as required so there is no need for any competition. Where there is less resources or raw materials the issue of competition arises.

7) B. Economizing behavior

Economizing behavior is a situation wherein one adjusts his/her behaviour in such a way that he/she is positioned for the most benefit at the least possible cost. The rich and the poor both have this kind of mentality.

8) C. Make choices based on a comparison of cost and benefit

Economic theory throws light on the fact of making profits. In order to make profits people make choices based on a comparisson of cost and benefit. They will go for a product which is less expensive but it should yield maximum benefits.

9) D. all of the above

Private property is owned by the individual and no one from outside interferes. So the owners get to know the rules, all the information are dependable as there is no third party, the incentives are also allocated to them only as they are only the owners.

10. D. was the result of human intentions but not anyones design

U.S economy is a mixed economy which takes care of the capitalists and the individual freedom both and it was created as a result of the peoples intentions how should it work.