1) Why do consumers have to make tradeoffs in deciding what to consume?

A. there are not enough of all goods produced.

B. they are limited by a budget constraint.

C. the prices of goods vary.

D. not all goods give them the same amount of satisfaction.

2) Economics does not study correct or incorrect behaviors, but rather it assumes that economic agents make the best decisions given their knowledge of the costs and benefits. What term best describes this behavior?

A. selfishly

B. emotionally

C. rationally

D. equitably

3) Consider a good whose consumption takes place publicly. On what factors would your decision to buy that good depend?

A. only on the price of the good, and not on other factors, such as other people's actions.

B. only on how many other people buy the good, and not on the...