Exam 2: Production Possibilities and Economic Systems

A society on its production possibilities curve is

An inefficient factory is likely to close down under capitalism for which of the following reasons?

Figure 2-2 -In Table 2-1,the opportunity cost of each additional television in terms of computers given up

The organization of productive activities among persons and regions so that no one individual or area is totally self-sufficient is known as

In general,specialization allows

When a society forgoes current consumption to invest in the production of capital goods,

One assumption underlying the production possibilities curve is that

Three Ps of capitalism are

Figure 2-2 -In Figure 2-2,points U,V,Y,and Z show

Does the production of capital goods imply less current consumption? If it does,when is the reduction in consumption worthwhile? Explain.

International trade allows the world to

A person has a comparative advantage in an activity whenever she

Which of the following is NOT one of the three basic economic questions?

Comparative advantage is always a(n)________ concept.

Specialization and trade

What are the three basic economic questions in every country?

Suppose a hectare of land yields 100 tonnes of corn and that one tonne of corn provides enough seed for one-quarter of a hectare of land.The opportunity cost of consuming another tonne of corn today is

Explain the relationship between productive efficiency and allocative efficiency.

Define productive efficiency.Explain why being productively efficient does not necessarily mean using the latest in high-tech production methods.

Figure 2-4 -In Figure 2-4,the bowed-out shape of the production possibilities curve indicates that