Which of the Following Statements Best Describes the Study of Economics

question 105

Multiple Choice

Which of the following statements best describes the study of economics?

• A) Economics studies how firms make profits.
• B) Economics studies how to organise production so that scarcity does not occur.
• C) Economics studies how businesses reach decisions.
• D) Economics studies how we make choices in the face of scarcity.
• E) Economics studies how to create incentives so that scarcity does not exist.

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Definitions:

B Data

Behavioral data in psychology, which consists of observations about an individual's behavior in natural or staged scenarios, often used for assessing personality.

Face Validity

The degree to which an assessment instrument, such as a questionnaire, on its face appears to measure what it is intended to measure. For example, a face-valid measure of sociability might ask about attendance at parties.

Exploratory Factor Analysis

A statistical technique used to identify potentially underlying variable structures within a set of observed variables without a preconceived structure in mind.

Confirmatory Factor Analysis

A statistical method used to test whether a set of observed variables represents a number of underlying factors.