Economists Use the Scientific Method and the Tools of Economics

question 130

Multiple Choice

Economists use the scientific method and the tools of economics to study

• A) only the decisions of individuals.
• B) only the decisions of business firms.
• C) only economic growth and gross domestic product (GDP).
• D) only the production possibilities curve.
• E) anything around them; the world is the economist's laboratory.

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Definitions:

Cartel

An agreement among competing firms to control prices or exclude entry of a new competitor in a market, often leading to market inefficiencies and lack of competition.

Price Effect

The effect of a price change of a product or service on its supply or demand.

Oligopolist

A firm in an industry with only a small number of producers.

Monopolist

A single seller in a market who has significant control over the supply of a particular good or service, often leading to less competition and higher prices.