Exam 3: The Fundamental Economic Problem: Scarcity and Choice

The concept of "an invisible hand" led Adam Smith to believe that

If production involves increasing opportunity cost, then moving nearer the horizontal axis will increase the opportunity cost of

Since it spent over $3.6 trillion in 2010, opportunity cost was not an issue for the U.S.government.

If production involves decreasing opportunity cost, the production possibilities curve

​Adam Smith believed that markets coordinated the self-interests of consumers.

Opportunity cost cannot be measured in money terms, only in conceptual terms.

The notion of opportunity cost can be represented graphically by the

The concavity or bowed-out shape of the production possibilities frontier is the result of

Employment discrimination is a source of

From a society's viewpoint, when all resources are fully employed, a decision to have more of one thing means we must give up some of another thing.

Although specialization of labor increases efficiency of production, it can lead to another major problem:

What would be the opportunity cost of a child using a coupon for a free ice cream cone?

Which of the following does not determine the position and shape of a society's PPF?

Although all points on the PPF are efficient, that alone does not tell us which point is "best" for the society.

The opportunity cost of increased production of some good can be measured with

An optimal decision is one that chooses the most desirable from among all possibilities that are available.

A market system is not considered an effective way of controlling self-interest.

Workers in Adam Smith's famous pin factory example, who were proficient in pin production, then faced the problem of

The money cost of a particular good will approximate its opportunity cost if

The definition of efficiency implies that production is carried out on the production possibilities frontier.