Exam 3: Scarcity, Trade-Offs, and Production Possibilities

Exhibit 3-7 Refer to Exhibit 3-7.The diagram represents a tradeoff in an economy between prison cells and classrooms.Which position represents the choice to allocate the greatest amount of resources to producing classrooms?

It can be said that,ultimately,consumers are the driving force behind answers to the three basic economic questions faced by societies.Explain the consumer's role in providing these answers.

A production possibilities curve that is "bowed out" or concave to the origin:

An inefficient allocation of resources or unusually high unemployment:

Capital accumulation causes the production possibilities curve to shift inward over time.

Which of the following would not shift the production possibilities curve in an inward direction?

Exhibit 3-7 Refer to Exhibit 3-7.The diagram represents a tradeoff in an economy between prison cells and classrooms.Which position represents the choice to allocate the greatest amount of resources to producing prison cells?

A technological advance that increases the productivity of all inputs is best illustrated as:

Which of the following would be likely to expand a production possibilities curve?

Which of the following does not describe a pure market economy?

Any output combination outside the production possibilities curve is attainable in the current period only if prices decrease.

Exhibit 3-11 Refer to Exhibit 3-11.Which of the following best explains how the society producing breadfruit and fish depicted above could have moved from curve AA to curve BB?

Assume that,given factors of production and existing knowledge and technology,it is not possible to produce more of one good without foregoing the opportunity to produce some of another good.Economists would characterize this situation as:

A devastating earthquake destroys ten percent of the population in California.As a result:

Exhibit 3-3 Refer to Exhibit 3-3.Along the production possibilities curve,the most efficient point of production depicted is:

An increase in production of one good will have zero opportunity cost only if the economy initially existed at a point inside the production possibilities curve.

Three economic questions must be determined in all societies.What are they?

Exhibit 3-13 Refer to Exhibit 3-13.A movement from Point D to Point A:

A production possibilities curve is negatively sloped because:

Which of the following is not a question that scarcity forces all societies to answer?