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1.	. "Government should not use price controls" is an example of:

A. positive economics.
B. normative economics.
C. the art of economics.
D. Marshallian economics.		B. normative economics.

"Should" statements are always normative, or based upon opinion.
2.	. A cultural norm is:

A. an economic force.
B. a social force.
C. a political force.
D. a market force.		. a social force.
3.	. Experimental economics is:

A. a naturally occurring event that approximates a controlled experiment.
B. not possible given that economists study real-world events.
C. a branch of economics that studies the economy through controlled lab experiments.
D. what all economists do when they develop their models.		a branch of economics that studies the economy through controlled lab experiments
4.	. In 2004, oil facilities in Iraq were attacked amid strong demand for oil. In response, political pressure motivated OPEC to increase the daily quota by 2 million barrels a day. Assuming demand did not change, which of the following series of prices most likely matches how the price of a barrel of oil changed from (1) before the attack, to (2) just after the attack, to (3) after OPEC increased the quota?
A. $42, $38, $40
B. $38, $40, $42
C. $42, $40, $38
D. $40, $42, $38		D. $40, $42, $38
Events in Iraq initially caused the price to rise from $40 to $42; increased production by OPEC then lowered the price to $38.
5.	. Modern behavioral economists are most likely to incorporate an assumption of:


A. Self-interest.
B. Rationality.
C. Predictable irrationality.
D. Efficiency.		Predictable irrationality.
6.	. Modern traditional economists use models that focus on which two assumptions?

A. Rationality and self-interest.
B. Duplicity and self-interest.
C. Predictable irrationality and purposeful self-interest.
D. Predictiable irrationality and efficiency.		Rationality and self-interest.
7.	. The price mechanism that guides our actions is called the:

A. invisible market force.
B. invisible hand.
C. invisible handshake.
D. invisible foot.		. invisible hand.
8.	. The quantity of goods and services available to society:

A. is fixed.
B. depends on human action.
C. is not of economic importance.
D. will always grow to meet individuals' wants and desires.		depends on human action


The quantity of goods and services available depends on the incentives to work.
9.	. Your opportunity cost of taking this course is:

A. the tuition you paid for the course.
B. the net benefit of the activity you would have chosen if you had not taken the course.
C. the net benefit of taking this course.
D. the cost of the activity you would have chosen if you had not taken the course.		. the net benefit of the activity you would have chosen if you had not taken the course.