- 1. Economists make all of the following assumptions about
business firms except:
- A. firms are the principal owners of factors of
production.
- B. firms generally make consistent decisions.
- C. firms seek to maximize profits.
- D. firms employ factors of production to produce
commodities.
- 2. Markets for factor services arise:
- A. in economies where each household is self-sufficient.
- B. in barter economies only.
- C. in any economy, regardless of how it is organized.
- D. in an economy characterized by specialization of
labor.
- 3. In economic theory, the behavioral assumptions of
consistent behavior and maximization of satisfaction or
profit are applied to:
- A. households, firms, and governments.
- B. households and firms.
- C. governments only.
- D. households only.
- E. firms only.
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