Exam 2: Choice, Opportunity Costs, and Specialization

Given below is the production possibilities schedule for capital goods and consumer goods. Table 2.3 Production Possibilities Schedule Combination Capital Goods Consumer Goods A 4 0 B 3 4 C 2 7 D 1 9 E 0 10 -If the nation depicted in Figure 2.3 is producing at combination E, the opportunity cost of producing the tenth unit of consumer good is:

The table given below represents the output per hour of cookies and chilies in Ohio and Iowa. Table 2.4 Output per Hour Iowa Cookies Chilies Ohid 6 24 Iowa 12 96 -Refer to Table 2.4. Identify the correct statement.

A bowed-out production possibilities curve [PPC] implies that the marginal opportunity cost of producing more of one good is:

The figure given below represents the production possibilities curve for goods and services in an economy. Figure 2.3 -Refer to Figure 2.3. The movement from Curve X to Curve Y indicates:

Shirley can choose between peanut butter pretzels and caramel coated popcorns for her evening snack. According to economists, her _____ cost of consuming caramel coated popcorns would be the forgone peanut butter pretzels.

Marginal opportunity cost refers to the:

If an individual can produce a good or service with a lower opportunity cost than another individual, then he or she is said to have the comparative advantage.

The table given below represents the output per hour of cookies and chilies in Ohio and Iowa. Table 2.4 Output per Hour Iowa Cookies Chilies Ohid 6 24 Iowa 12 96 -Refer to Table 2.4. The opportunity cost of a chili in Ohio is:

Consider the production possibilities curve [PPC] for a country producing only two commodities; wheat and wine. Ceteris paribus, the _____ cost of producing wine increases with each successive increase in wine production.

The table given below represents the output per hour of cookies and chilies in Ohio and Iowa. Table 2.4 Output per Hour Iowa Cookies Chilies Ohid 6 24 Iowa 12 96 -Refer to Table 2.4. Calculate the opportunity cost of a cookie in Iowa.

Individuals, firms, and nations should specialize in those activities which have the highest marginal cost.

Which of the following would not cause any kind of an outward shift of a nation's production possibilities curve [PPC]?

While constructing a production possibilities frontier [PPF], we assume:

The figure given below represents the PPC in two nations - Germany and Korea, producing only two goods cars and food. Figure 2.4 -Refer to Figure 2.4. What would be the marginal opportunity cost of producing one unit of food in Korea assuming the economy is at point B?

Economic growth can be illustrated by an outward shift of the PPC.

The concept of comparative advantage applies to:

The marginal cost of producing a commodity increases because of specialization.

Which of the following is an example of opportunity cost?

Which of the following best describes a tradeoff?

The giving up of a good or activity in order to obtain some other good or activity is called: