Exam 2: Production Possibilities Frontier Framework

Country 1 produces two goods,A and B.Country 2 produces the same two goods.Currently,country 1 produces 100A and 200B and country 2 produces 300A and 700B.Which of the following statements is true?

Productive efficiency implies that

In an eight-hour day,Andy can produce either 24 loaves of bread or 8 pounds of butter.In an eight-hour day,John can produce either 8 loaves of bread or 8 pounds of butter.The opportunity cost of producing 1 pound of butter is

-Refer to Exhibit 2-1.The movement from point A to point B is a movement from

-Refer to Exhibit 2-5.Given available resources and technology,this economy can produce 50,000 television sets and 50,000 fax machines only if it chooses to

A PPF is bowed outward as a result of

The economy can produce 15X and 15Y,10X and 20Y,5X and 25Y,or 0X and 30Y.It follows that opportunity cost of 1X is ___Y.

Points that lie outside (or beyond)the PPF are

Suppose an economy can produce a maximum of 10 units of good X and the opportunity cost of 1X is always 2Y.What is the maximum number of units of good Y the economy can produce?

-Refer to Exhibit 2-4.The line joining points A and D is called the

If there is always a three-for-one tradeoff between goods X and Y,then the PPF between X and Y is

-Refer to Exhibit 2-1.A movement from point B to point D

A decrease in unemployment causes the PPF to shift outward (to the right).

Jose has one evening in which to prepare for two exams and can employ one of two possible strategies: The opportunity cost of receiving a 93 on the economics exam is __________ points on the statistics exam.

The point where the PPF intersects the vertical axis is

-Refer to Exhibit 2-9.Who has the comparative advantage in the production of good B?