Test Bank For Principles of Economics Fourth Edition by Dirk Mateer Lee Coppock Chapter 1-33 CHAPTER 1 The Five Foundations of Economics CONCEPT MAP I.
Economics
II.
Macroeconomics
III.
Microeconomics
IV.
Incentives
A.
Positive Incentives
B.
Negative Incentives
C.
Direct Incentives
D.
Indirect Incentives
V.
Scarcity
VI.
Trade-offs
VII.
Opportunity Cost
VIII.
Marginal Analysis
IX.
Trade
A.
Comparative Advantage
B.
Specialization
MULTIPLE-CHOICE QUESTIONS 1. In economics, choices are necessary because of the presence of: a. luxuries. b. inefficiency. c. needs. d. scarcity. e. incentives. ANS: D
DIF: Easy TOP: I.REF: What Is Economics?MSC: Remembering
2. Economics is the study of: a. how to make money. b. how to allocate resources to satisfy wants and needs.