ECN 221 Exam 1 Study Guide/Practice Questions and answers
already passed 2025
1. What is scarcity? Tthe concept that there is less of something
freely available from nature than people
would like
2. Why are trade-offs and rationing green eyes". Is this
nec- essary in a world with statement a positive or
scarcity? normative statement,
and why?
3. What are the eight guideposts to
eco- nomic thinking?
4. "Every student at UNCW has
1/
15
,ECN 221 Exam 1 Study Guide/Practice Questions and answers
already passed 2025
Since resources at limited and desires are unlimit- ed, marginal benefits of their decisions
we must ration our resources and trade-otts are 5. Information helps us make better
necessary when making decisions choices but is costly to attain
6. Actions generate both direct and
1. Because resources are scarce, trade-otts must be indirect sec- ondary ettects
made 7. Values and preferences are
2. Individuals are rational: They try to maximize subjective and unique to each person
their benefits relative to their costs when making 8. The test of a theory is its ability to
decisions predict. The- ories are only valuable if they are
3. Incentives matter and influence choices in pre- valid and predict or model actual human
dictable ways behavior
4. Individuals make decisions on the margin,
where they consider the ettect of a change on their This is a positive statement because it is
cur- rent situation. People weigh the marginal costs and testable, even though it is not true
2/
15
already passed 2025
1. What is scarcity? Tthe concept that there is less of something
freely available from nature than people
would like
2. Why are trade-offs and rationing green eyes". Is this
nec- essary in a world with statement a positive or
scarcity? normative statement,
and why?
3. What are the eight guideposts to
eco- nomic thinking?
4. "Every student at UNCW has
1/
15
,ECN 221 Exam 1 Study Guide/Practice Questions and answers
already passed 2025
Since resources at limited and desires are unlimit- ed, marginal benefits of their decisions
we must ration our resources and trade-otts are 5. Information helps us make better
necessary when making decisions choices but is costly to attain
6. Actions generate both direct and
1. Because resources are scarce, trade-otts must be indirect sec- ondary ettects
made 7. Values and preferences are
2. Individuals are rational: They try to maximize subjective and unique to each person
their benefits relative to their costs when making 8. The test of a theory is its ability to
decisions predict. The- ories are only valuable if they are
3. Incentives matter and influence choices in pre- valid and predict or model actual human
dictable ways behavior
4. Individuals make decisions on the margin,
where they consider the ettect of a change on their This is a positive statement because it is
cur- rent situation. People weigh the marginal costs and testable, even though it is not true
2/
15
