Economics

question 115

Multiple Choice

Economics:

• A)studies human behavior when scarcity exists and choices must be made.
• B)provides the only reasonable explanation of how people make decisions.
• C)can accurately explain all human behavior since it is based on the assumption of rationality.
• D)is better at showing the way things ought to be than the other social sciences.
• E)is the only social science that can explain the existence and behavior of public institutions.

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Definitions:

Marginal Utility

The additional satisfaction or benefit gained from consuming one more unit of a good or service.

Pretzels

A type of baked pastry made from dough that is commonly shaped into a knot and often salted.

Budget Constraint

A representation of all the combinations of goods and services that a consumer can afford with a fixed income and prices.

Indifference Curve

A graph representing different bundles of goods between which a consumer is indifferent, showing combinations that give the consumer the same level of satisfaction.