Exam 2: The Economic Problem

-If the United States can increase its production of automobiles without decreasing its production of any other good, the United States must have been producing at a point

Individual economic decisions are coordinated by

We are using resources efficiently if we can produce more of one good without producing less of some other good that we value more highly.

-The opportunity cost of moving from point a to point b in the above figure is ________.

-The figure above shows Roger's production possibilities frontier. Point a is an ________ point and at that point production is ________.

The social arrangements that govern the ownership, use, and disposal of property are referred to as

At one point along a PPF 40 tons of wheat are produced while 80 tons of rice are produced. At another point along the same PPF, 41 tons of wheat are produced while 70 tons of rice are produced. The opportunity cost of producing a ton of wheat between these points is ________ per ton of wheat.

-Agnes can produce either 1 unit of X or 1 unit of Y in an hour, while Brenda can produce either 2 units of X or 4 units of Y in an hour. The opportunity cost of producing a unit of X is

An economy produces only food and shelter. There are two individuals in the economy: Bill and Mary. Mary's opportunity cost of producing 1 unit of shelter is 2 units of food. Bill's opportunity cost of producing 1 unit of shelter is 4 units of food.

-In the figure above, if 4 million computers are produced per year then the ________ should be produced to achieve the allocatively efficient use of resources.

Explain the connection between opportunity cost and the PPF.

Economic growth can be pictured in a production possibilities frontier diagram by

A marginal benefit curve shows

-The above table shows production combinations on a country's production possibilities frontier. The opportunity cost of increasing the production of Y from 16 to 28 units is ________ units of good X per unit of good Y.

-An economy produces at point a on the PPF shown in the above figure. A drought reduces the amount of wheat produced and the economy produces at point b. The opportunity cost of a unit of wheat ________.

-According to the figure above, the opportunity cost of producing another computer is

Resource use is allocatively efficient when marginal benefit is

-According to the diagram in the figure above, an allocatively efficient use of resources requires that production and consumption of gasoline be

Which of the following statements can used to describe efficiency? I. Efficiently using resources means that producers make the highest profits possible. II) Using resources efficiently means that we cannot produce more of one good without producing less of another good that has a higher value. III) Resource use is efficient when we produce goods and services that people value most highly.

Blue Violet's Orange Rose'sproduction possibilities production possibilities -Two countries, Blue Violet and Orange Rose, produce only two goods: teapots and coffeepots. The table above gives their production possibilities. ________ has a comparative advantage in teapots and ________ has a comparative advantage in coffeepots.