1. According to the author in Chapter 2, the average annual income is what in the location where black rhinoceros horns are worth much on the black market?
(a) $8,700.
(b) $6,000.
(c) $2,500.
(d) $1,000.

2. What refers to the degree to which a correct forecast of a system's state can be made either qualitatively or quantitatively?
(a) Security.
(b) Recession.
(c) Index.
(d) Predictability.

3. What are negative results which occur while trying to achieve a goal for the common good?
(a) Abstract incentives.
(b) Perverse incentives.
(c) Unknown incentives.
(d) Ghost incentives.

4. In order to get a true understanding of an economy, there are nine factors one should consider along with the GDP according to the author in Chapter 9. What is the first?
(a) Poverty.
(b) National savings.
(c) Unemployment.
(d) Total national happiness.

5. What is the capital of the Democratic People's Republic of Korea?
(a) Pyongyang.
(b) Honk Kong.
(c) Osaka.
(d) Beijing.

Short Answer Questions

1. According to the author in Chapter 13, when it comes to gaining economic power, it's best to avoid what, which depletes resources and limits education?

2. In economics, what refers to a general slowdown in economic activity?

3. What is the process of contracting a business function to someone else?

4. According to the author, there are two lessons to be learned from a monopoly situation. What is the second?

5. When was Douglas Ivester born?

(see the answer key)

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