Exam 2: Trade-Offs, Comparative Advantage, and the Market System

How are efficiency and inefficiency represented on a production possibilities frontier?

What is meant by the term "free market"?

Firms

Figure 2-16 -Refer to Figure 2-16. In the circular flow diagram, who are economic agents A and who are economic agents B?

An example of a factor of production is

Figure 2-4 Figure 2-4 shows various points on three different production possibilities frontiers for a nation. - Refer to Figure 2-4. Consider the following movements: a. from point V to point W b. from point W to point Y c. from point Y to point Z Which of the movements listed above represents advancements in technology with respect to both plastic production and food production?

________ shows that if all resources are fully and efficiently utilized, more of one good can be produced only by producing less of another good.

The points outside the production possibilities frontier are

Table 2-2 Production choices for Billie's Bedroom Shop -Refer to Table 2-2. Assume that Billie's Bedroom Shop only produces pillows and blankets. A combination of 27 pillows and 14 blankets would appear

Figure 2-15 -Refer to Figure 2-15. One segment of the circular flow diagram in the figure shows the flow of wages and salaries from market K to economic agents M. What is market K and who are economic agents M?

Figure 2-10 -Refer to Figure 2-10. If the economy is currently producing at point E, what is the opportunity cost of moving to point B?

Figure 2-4 Figure 2-4 shows various points on three different production possibilities frontiers for a nation. -Refer to Figure 2-4. A movement from Y to Z

If opportunity costs are constant, the production possibilities frontier would be graphed as

Which of the following statements about a circular flow model is false?

Any output combination along a production possibility frontier is associated with overused or unattainable resources.

Which of the following is an example of spending on goods and services in the circular flow model?

Which of the following statements about an entrepreneur is false?

Table 2-9 Table 2-9 shows the output per week of two jewelers, Serena and Haley. They can either devote their time to making bracelets or making necklaces. -Refer to Table 2-9. What is Serena's opportunity cost of making a necklace?

Which of the following are separate flows in the circular flow model?

If society decides it wants more of one good and ________, then it has to give up some of another good and incur some opportunity costs.