Question 1

What is the relationship between the bowed out shape of the production possibilities frontier and the increasing opportunity cost of a good as more of it is produced?

Accepted Answer

The production possibilities frontier is

Question 2

-Using the values for the marginal benefit and the marginal cost of a bushel of apples given in the table above, what is the allocatively efficient quantity of apples? Suppose 10 million bushels of apples are produced. Should the quantity be increased or deceased? What if 20 million bushels are produced; should the quantity be increased or decreased?

Accepted Answer

The allocatively efficient quantity of a

Question 3

Tom takes 20 minutes to burn a CD and 5 minutes to make a sandwich. Jerry takes 15 minutes to burn a CD and 3 minutes to make a sandwich. Both individuals will be better off if

Accepted Answer

A)  Jerry trades sandwiches in exchange for CDs. 
B)  Tom trades sandwiches in exchange for CDs. 
C)  they trade, no matter who trades sandwiches and who CDs. 
D)  they don't trade. 
A)  Jerry trades sandwiches in exchange for CDs. 
B)  Tom trades sandwiches in exchange for CDs. 
C)  they trade, no matter who trades sandwiches and who CDs. 
D)  they don't trade.

Question 4

"Allocative efficiency requires that the maximum number of people have access to all of the goods and services that our economy produces." Is this statement true or false? Explain your answer.

Accepted Answer

The statement is false. Allocative effic

Question 5

A computer software program is most strongly an example of

Accepted Answer

A)  vicarious property. 
B)  fiat property. 
C)  intellectual property. 
D)  real property. 
A)  vicarious property. 
B)  fiat property. 
C)  intellectual property. 
D)  real property.

Question 6

-In the table above, country B is producing 4 units of X and 6 units of Y. For country B, the opportunity cost of producing an additional unit of X is

Accepted Answer

A)  4 units of Y. 
B)  2 units of Y. 
C)  1 unit of Y 
D)  3/2 units of Y. 
A)  4 units of Y. 
B)  2 units of Y. 
C)  1 unit of Y 
D)  3/2 units of Y.

Question 7

A circular flow diagram shows the flows from the goods and resources markets.

Accepted Answer

A) True 
 B)False

Question 8

We measure the marginal of a good by what a for another unit of the good.

Accepted Answer

A)  cost; person's preferences are 
B)  benefit; person must pay 
C)  cost; person is willing to pay 
D)  benefit; person is willing to pay 
A)  cost; person's preferences are 
B)  benefit; person must pay 
C)  cost; person is willing to pay 
D)  benefit; person is willing to pay

Question 9

Economic growth is the result of all of the following EXCEPT

Accepted Answer

A)  technological change. 
B)  opportunity cost. 
C)  investment in human capital. 
D)  capital accumulation. 
A)  technological change. 
B)  opportunity cost. 
C)  investment in human capital. 
D)  capital accumulation.

Question 10

Explain the connection between opportunity cost and the PPF.

Accepted Answer

When moving along the production possibi

Question 11

Tom takes 20 minutes to burn a CD and 5 minutes to make a sandwich. Jerry takes 15 minutes to burn a CD and 3 minutes to make a sandwich. If Tom and Jerry trade

Accepted Answer

A)  Jerry will benefit and Tom will not. 
B)  Tom will benefit and Jerry will not. 
C)  both will benefit. 
D)  none of them will benefit. 
A)  Jerry will benefit and Tom will not. 
B)  Tom will benefit and Jerry will not. 
C)  both will benefit. 
D)  none of them will benefit.

Question 12

-As output moves from point a to point b to point c along the PPF in the above figure, the opportunity cost of one more unit of good X

Accepted Answer

A)  rises. The opportunity cost of one more unit of good Y also rises. 
B)  rises. The opportunity cost of one more unit of good Y falls. 
C)  falls. The opportunity cost of one more unit of good Y also falls. 
D)  falls. The opportunity cost of one more unit of good Y rises. 
A)  rises. The opportunity cost of one more unit of good Y also rises. 
B)  rises. The opportunity cost of one more unit of good Y falls. 
C)  falls. The opportunity cost of one more unit of good Y also falls. 
D)  falls. The opportunity cost of one more unit of good Y rises.

Question 13

Moving on a bowed out PPF, what happens to the opportunity cost of a good as more of it is produced?

Accepted Answer

The bowed out PPF indicates th

Question 14

-In the above figure, curve b shows the

Accepted Answer

A)  bottles of soda that people are willing to forgo to get another bicycle. 
B)  benefits of producing more soda is greater than the benefits of producing more bicycles. 
C)  benefits of producing more bicycles is greater than the benefits of producing more soda. 
D)  bottles of soda that people must forgo to get another bicycle. 
A)  bottles of soda that people are willing to forgo to get another bicycle. 
B)  benefits of producing more soda is greater than the benefits of producing more bicycles. 
C)  benefits of producing more bicycles is greater than the benefits of producing more soda. 
D)  bottles of soda that people must forgo to get another bicycle.

Question 15

-Refer to the production possibilities frontier in the figure above. Which production point indicates that resources are NOT fully utilized or are misallocated?

Accepted Answer

A)  Point a 
B)  Point b 
C)  Point c 
D)  Point e 
A)  Point a 
B)  Point b 
C)  Point c 
D)  Point e

Question 16

Generally, opportunity costs increase and the production possibilities frontier bows outward. Why?

Accepted Answer

A)  Labor is scarcer than capital. 
B)  Technology is slow to change. 
C)  Unemployment is inevitable. 
D)  Resources are not equally useful in all activities. 
A)  Labor is scarcer than capital. 
B)  Technology is slow to change. 
C)  Unemployment is inevitable. 
D)  Resources are not equally useful in all activities.

Question 17

A reduction in the amount of unemployment

Accepted Answer

A)  moves the economy's point of production along the production possibilities frontier. 
B)  moves the economy's point of production further away from the production possibilities frontier. 
C)  moves the economy's point of production closer to the production possibilities frontier. 
D)  shifts the production possibilities frontier outward. 
A)  moves the economy's point of production along the production possibilities frontier. 
B)  moves the economy's point of production further away from the production possibilities frontier. 
C)  moves the economy's point of production closer to the production possibilities frontier. 
D)  shifts the production possibilities frontier outward.

Question 18

The most anyone is willing to pay for another purse is $30. Currently the price of a purse is $40, and the cost of producing another purse is $50. The marginal benefit of a purse is

Accepted Answer

A)  $40. 
B)  $50. 
C)  $30. 
D)  an amount not given in the answers above. 
A)  $40. 
B)  $50. 
C)  $30. 
D)  an amount not given in the answers above.

Question 19

Marginal cost is the one more unit of a good and of the good increases.

Accepted Answer

A)  opportunity cost of producing; decreases as production 
B)  opportunity cost of producing; increases as production 
C)  benefit from consuming; decreases as consumption 
D)  benefit from consuming; increases as consumption 
A)  opportunity cost of producing; decreases as production 
B)  opportunity cost of producing; increases as production 
C)  benefit from consuming; decreases as consumption 
D)  benefit from consuming; increases as consumption

Question 20

Increasing opportunity costs suggests that

Accepted Answer

A)  various types of labor are not perfect substitutes for one another. 
B)  there is no difference between inputs used in a production process. 
C)  all labor and capital are costlessly interchangeable. 
D)  various types of labor are perfect substitutes for one another. 
A)  various types of labor are not perfect substitutes for one another. 
B)  there is no difference between inputs used in a production process. 
C)  all labor and capital are costlessly interchangeable. 
D)  various types of labor are perfect substitutes for one another.

What is the relationship between the bowed out shape of the production possibilities frontier and the increasing opportunity cost of a good as more of it is produced?

Tom takes 20 minutes to burn a CD and 5 minutes to make a sandwich. Jerry takes 15 minutes to burn a CD and 3 minutes to make a sandwich. Both individuals will be better off if

"Allocative efficiency requires that the maximum number of people have access to all of the goods and services that our economy produces." Is this statement true or false? Explain your answer.

A computer software program is most strongly an example of

-In the table above, country B is producing 4 units of X and 6 units of Y. For country B, the opportunity cost of producing an additional unit of X is

A circular flow diagram shows the flows from the goods and resources markets.

We measure the marginal of a good by what a for another unit of the good.

Economic growth is the result of all of the following EXCEPT

Explain the connection between opportunity cost and the PPF.

Tom takes 20 minutes to burn a CD and 5 minutes to make a sandwich. Jerry takes 15 minutes to burn a CD and 3 minutes to make a sandwich. If Tom and Jerry trade

-As output moves from point a to point b to point c along the PPF in the above figure, the opportunity cost of one more unit of good X

Moving on a bowed out PPF, what happens to the opportunity cost of a good as more of it is produced?

-In the above figure, curve b shows the

-Refer to the production possibilities frontier in the figure above. Which production point indicates that resources are NOT fully utilized or are misallocated?

Generally, opportunity costs increase and the production possibilities frontier bows outward. Why?

A reduction in the amount of unemployment

The most anyone is willing to pay for another purse is $30. Currently the price of a purse is $40, and the cost of producing another purse is $50. The marginal benefit of a purse is

Marginal cost is the one more unit of a good and of the good increases.

Increasing opportunity costs suggests that

What Is Economics

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters

Exam 2: The Economic Problem

What is the relationship between the bowed out shape of the production possibilities frontier and the increasing opportunity cost of a good as more of it is produced?

Tom takes 20 minutes to burn a CD and 5 minutes to make a sandwich. Jerry takes 15 minutes to burn a CD and 3 minutes to make a sandwich. Both individuals will be better off if

"Allocative efficiency requires that the maximum number of people have access to all of the goods and services that our economy produces." Is this statement true or false? Explain your answer.

A computer software program is most strongly an example of

-In the table above, country B is producing 4 units of X and 6 units of Y. For country B, the opportunity cost of producing an additional unit of X is

A circular flow diagram shows the flows from the goods and resources markets.

We measure the marginal of a good by what a for another unit of the good.

Economic growth is the result of all of the following EXCEPT

Explain the connection between opportunity cost and the PPF.

Tom takes 20 minutes to burn a CD and 5 minutes to make a sandwich. Jerry takes 15 minutes to burn a CD and 3 minutes to make a sandwich. If Tom and Jerry trade

-As output moves from point a to point b to point c along the PPF in the above figure, the opportunity cost of one more unit of good X

Moving on a bowed out PPF, what happens to the opportunity cost of a good as more of it is produced?

-In the above figure, curve b shows the

-Refer to the production possibilities frontier in the figure above. Which production point indicates that resources are NOT fully utilized or are misallocated?

Generally, opportunity costs increase and the production possibilities frontier bows outward. Why?

A reduction in the amount of unemployment

The most anyone is willing to pay for another purse is $30. Currently the price of a purse is $40, and the cost of producing another purse is $50. The marginal benefit of a purse is

Marginal cost is the one more unit of a good and of the good increases.

Increasing opportunity costs suggests that

What Is Economics

Demand and Supply

Measuring Gdp and Economic Growth

Monitoring Jobs and Inflation

Economic Growth

Finance, Saving, and Investment

Money, the Price Level, and Inflation

The Exchange Rate and the Balance of Payments

Aggregate Supply and Aggregate Demand

Expenditure Multipliers: They Keynesian Model

U.S. Inflation, Unemployment, and Business Cycle

Fiscal Policy

Monetary Policy

International Trade Policy

Filters