Question 1

The production possibilities frontier is the boundary between the

Accepted Answer

A) goods and services that the economy can produce. 
B) attainable and unattainable combinations of goods and services. 
C) wanted and unwanted combinations of goods and services. 
D) rational and irrational choices facing a society. 
E) affordable and unaffordable combinations of production. 
A) goods and services that the economy can produce. 
B) attainable and unattainable combinations of goods and services. 
C) wanted and unwanted combinations of goods and services. 
D) rational and irrational choices facing a society. 
E) affordable and unaffordable combinations of production.

Question 2

-The figure above shows a production possibilities frontier.In the figure,which of the following combinations of the two goods cannot be produced with the current resources and technology?

Accepted Answer

A) 2 million cell phones and 13 million DVDs 
B) 4 million cell phones and 4 million DVDs 
C) 1 million cell phones and 14 million DVDs 
D) 3 million cell phones and 5 million DVDs 
E) 5 million cell phones and no DVDs 
A) 2 million cell phones and 13 million DVDs 
B) 4 million cell phones and 4 million DVDs 
C) 1 million cell phones and 14 million DVDs 
D) 3 million cell phones and 5 million DVDs 
E) 5 million cell phones and no DVDs

Question 3

-The table above gives the production possibilities frontier for a nation that produces wheat and soybeans.Use the information in that table to complete the table below,which has in it the opportunity costs of moving from one production point to another.Do not forget to note the units of the opportunity costs.

Accepted Answer

@#IMG-DLM& The table above gives the opp

Question 4

Having a comparative advantage means a nation can

Accepted Answer

A) benefit from trade. 
B) produce at a higher opportunity cost. 
C) produce more of the good. 
D) produce without incurring an opportunity cost. 
E) produce the good at a point beyond its PPF. 
A) benefit from trade. 
B) produce at a higher opportunity cost. 
C) produce more of the good. 
D) produce without incurring an opportunity cost. 
E) produce the good at a point beyond its PPF.

Question 5

-Robinson Crusoe divides his time between catching fish and gathering fruit.Part of his production possibilities frontier is given in the above table.If Mr.Crusoe is on his PPF and he increases the amount of fruit he gathers from 56 to 90 pounds,the opportunity cost is

Accepted Answer

A) 37 pounds of fish. 
B) 31 pounds of fish. 
C) 17 pounds of fish. 
D) 34 pounds of fruit. 
E) 90 pounds of fruit. 
A) 37 pounds of fish. 
B) 31 pounds of fish. 
C) 17 pounds of fish. 
D) 34 pounds of fruit. 
E) 90 pounds of fruit.

Question 6

-The table above gives the production possibilities frontier for two countries,Anaconda and Bear.The opportunity cost of moving from production point B to production point C for Anaconda equals ________ and for Bear equals ________.

Accepted Answer

A) 1 ton of corn;1 ton of corn 
B) 650 pairs of shoes;900 pairs of shoes 
C) 550 pairs of shoes;700 pairs of shoes 
D) 100 pairs of shoes;200 pairs of shoes 
E) 50 pairs of shoes;100 pairs of shoes 
A) 1 ton of corn;1 ton of corn 
B) 650 pairs of shoes;900 pairs of shoes 
C) 550 pairs of shoes;700 pairs of shoes 
D) 100 pairs of shoes;200 pairs of shoes 
E) 50 pairs of shoes;100 pairs of shoes

Question 7

If an economy cannot produce more of one good without producing less of another good,this implies that which of the following has been achieved?

Accepted Answer

A) allocative efficiency 
B) minimum marginal cost 
C) PPF efficiency 
D) production efficiency 
E) maximum marginal benefit 
A) allocative efficiency 
B) minimum marginal cost 
C) PPF efficiency 
D) production efficiency 
E) maximum marginal benefit

Question 8

-The table above shows the amounts of cloth and cheese that China and Pakistan can produce in an hour.Which country has the comparative advantage in cloth and which country has the comparative advantage in cheese?

Accepted Answer

In China,to produce 8 cloths has an oppo

Question 9

The United States can use all its resources to produce 250 DVDs or 500 shoes.China can use all of its resources to produce 30 DVDs or 300 shoes.The opportunity cost of producing a DVD in the United States is

Accepted Answer

A) 2 shoes. 
B) 1/2 of a shoe. 
C) 20 shoes. 
D) 500 shoes. 
E) 1 DVD. 
A) 2 shoes. 
B) 1/2 of a shoe. 
C) 20 shoes. 
D) 500 shoes. 
E) 1 DVD.

Question 10

-The table above shows a production possibilities frontier for an economy.Which of the following combinations is unattainable?

Accepted Answer

A) 0 loaves of bread and 800 books 
B) 100 loaves of bread and 800 books 
C) 200 loaves of bread and 800 books 
D) 300 loaves of bread and 200 books 
E) 0 loaves of bread and 0 books 
A) 0 loaves of bread and 800 books 
B) 100 loaves of bread and 800 books 
C) 200 loaves of bread and 800 books 
D) 300 loaves of bread and 200 books 
E) 0 loaves of bread and 0 books

Question 11

What is gained when people engage in specialization and trade?

Accepted Answer

A) Specialization and trade allow people to consume outside their individual production possibilities frontiers. 
B) Specialization and trade allow people to consume inside their production possibilities frontiers. 
C) Specialization and trade allow people to consume at a point on their production possibilities frontiers. 
D) Specialization and trade allow people to produce outside their individual production possibilities frontiers. 
E) There are no gains from specialization and trade. 
A) Specialization and trade allow people to consume outside their individual production possibilities frontiers. 
B) Specialization and trade allow people to consume inside their production possibilities frontiers. 
C) Specialization and trade allow people to consume at a point on their production possibilities frontiers. 
D) Specialization and trade allow people to produce outside their individual production possibilities frontiers. 
E) There are no gains from specialization and trade.

Question 12

-The above figure shows the production possibility frontier for a country.Suppose the country is producing at point D.What would be the opportunity cost to move to point C?

Accepted Answer

A) 6 thousand bottles of wine 
B) 15 thousand bottles of wine 
C) 12 tons of rice 
D) Nothing,it is a free lunch. 
E) This movement is not possible without economic growth. 
A) 6 thousand bottles of wine 
B) 15 thousand bottles of wine 
C) 12 tons of rice 
D) Nothing,it is a free lunch. 
E) This movement is not possible without economic growth.

Question 13

Using the figure above,suppose with no trade Liz and Joe each produce at point A on their respective PPFs.Then,Liz suggests that they specialize and trade.She would produces only smoothies and Joe would produce only salads.Then she would sell 10 smoothies to Joe at a price of 2.5 salads per smoothie.In this scenario,

Accepted Answer

A) Liz gains 10 smoothies and 5 salads,and Joe gains 5 smoothies. 
B) Liz gains 5 smoothies,and Joe gains 10 smoothies. 
C) Liz gains 10 smoothies,and Joe loses 5 smoothies. 
D) Liz gains 5 smoothies and 5 salads,and Joe loses 5 salads. 
E) Neither of the individuals gains from trade. 
A) Liz gains 10 smoothies and 5 salads,and Joe gains 5 smoothies. 
B) Liz gains 5 smoothies,and Joe gains 10 smoothies. 
C) Liz gains 10 smoothies,and Joe loses 5 smoothies. 
D) Liz gains 5 smoothies and 5 salads,and Joe loses 5 salads. 
E) Neither of the individuals gains from trade.

Question 14

If the production possibilities frontier between bottled water and water in a jug is a straight line,which of the following statements would be correct?

Accepted Answer

A) A large amount of unemployment must exist. 
B) Resources are equally productive at producing either product. 
C) There is no tradeoff between the two goods. 
D) There is no decrease in the production of one good when the production of the other is increased. 
E) Producing more of one good gives the economy a free lunch. 
A) A large amount of unemployment must exist. 
B) Resources are equally productive at producing either product. 
C) There is no tradeoff between the two goods. 
D) There is no decrease in the production of one good when the production of the other is increased. 
E) Producing more of one good gives the economy a free lunch.

Question 15

A bowed out production possibilities frontier shows

Accepted Answer

A) that resources are equally productive in all uses. 
B) increasing opportunity cost. 
C) that resources are not equally productive in all uses. 
D) Both answers B and C are correct. 
E) Both answers A and B are correct. 
A) that resources are equally productive in all uses. 
B) increasing opportunity cost. 
C) that resources are not equally productive in all uses. 
D) Both answers B and C are correct. 
E) Both answers A and B are correct.

Question 16

A bowed out production possibility frontier shows that the

Accepted Answer

A) opportunity cost of a good is constant as more of the good is produced. 
B) opportunity cost of a good decreases as more of the good is produced. 
C) opportunity cost of a good increases as more of the good is produced. 
D) opportunity cost relationship is linear. 
E) opportunity cost of producing another good is negative. 
A) opportunity cost of a good is constant as more of the good is produced. 
B) opportunity cost of a good decreases as more of the good is produced. 
C) opportunity cost of a good increases as more of the good is produced. 
D) opportunity cost relationship is linear. 
E) opportunity cost of producing another good is negative.

Question 17

When a nation is producing on its production possibilities frontier,if more resources are used to produce one good,then the production of other goods

Accepted Answer

A) must increase. 
B) must decrease. 
C) must remain the same. 
D) must change but they might increase or decrease. 
E) might increase if the nation can produce more efficiently. 
A) must increase. 
B) must decrease. 
C) must remain the same. 
D) must change but they might increase or decrease. 
E) might increase if the nation can produce more efficiently.

Question 18

Consider the United States' production of soy beans and running shoes.If the United States has an absolute advantage in the production of both goods compared to China,

Accepted Answer

A) both countries can gain from trade. 
B) only the United States can gain from trade. 
C) only China can gain from trade. 
D) each country will be able to produce at a point beyond its PPF. 
E) only the United States will be able to operate beyond its PPF. 
A) both countries can gain from trade. 
B) only the United States can gain from trade. 
C) only China can gain from trade. 
D) each country will be able to produce at a point beyond its PPF. 
E) only the United States will be able to operate beyond its PPF.

Question 19

-The figure above shows a production possibilities frontier.In the figure,which of the following combinations of the two goods are efficient?

Accepted Answer

A) 2 million cell phones and 13 million DVDs 
B) 5 million cell phones and 15 million DVDs 
C) No cell phones and 15 million DVDs 
D) 4 million cell phones and 4 million DVDs 
E) None of these combinations is efficient. 
A) 2 million cell phones and 13 million DVDs 
B) 5 million cell phones and 15 million DVDs 
C) No cell phones and 15 million DVDs 
D) 4 million cell phones and 4 million DVDs 
E) None of these combinations is efficient.

Question 20

To find the opportunity cost of producing one more unit of any product while on the production possibilities frontier requires

Accepted Answer

A) setting the amounts of the two products equal to each other. 
B) setting the change in one product equal to the change in the other product. 
C) dividing the amount of the product forgone by the amount of the product gained. 
D) subtracting the change in the product whose production increased from the change in the product whose production decreased. 
E) None of these describes how to find opportunity cost. 
A) setting the amounts of the two products equal to each other. 
B) setting the change in one product equal to the change in the other product. 
C) dividing the amount of the product forgone by the amount of the product gained. 
D) subtracting the change in the product whose production increased from the change in the product whose production decreased. 
E) None of these describes how to find opportunity cost.

The production possibilities frontier is the boundary between the

-The figure above shows a production possibilities frontier.In the figure,which of the following combinations of the two goods cannot be produced with the current resources and technology?

Having a comparative advantage means a nation can

-Robinson Crusoe divides his time between catching fish and gathering fruit.Part of his production possibilities frontier is given in the above table.If Mr.Crusoe is on his PPF and he increases the amount of fruit he gathers from 56 to 90 pounds,the opportunity cost is

-The table above gives the production possibilities frontier for two countries,Anaconda and Bear.The opportunity cost of moving from production point B to production point C for Anaconda equals and for Bear equals .

If an economy cannot produce more of one good without producing less of another good,this implies that which of the following has been achieved?

-The table above shows the amounts of cloth and cheese that China and Pakistan can produce in an hour.Which country has the comparative advantage in cloth and which country has the comparative advantage in cheese?

The United States can use all its resources to produce 250 DVDs or 500 shoes.China can use all of its resources to produce 30 DVDs or 300 shoes.The opportunity cost of producing a DVD in the United States is

-The table above shows a production possibilities frontier for an economy.Which of the following combinations is unattainable?

What is gained when people engage in specialization and trade?

-The above figure shows the production possibility frontier for a country.Suppose the country is producing at point D.What would be the opportunity cost to move to point C?

If the production possibilities frontier between bottled water and water in a jug is a straight line,which of the following statements would be correct?

A bowed out production possibilities frontier shows

A bowed out production possibility frontier shows that the

When a nation is producing on its production possibilities frontier,if more resources are used to produce one good,then the production of other goods

Consider the United States' production of soy beans and running shoes.If the United States has an absolute advantage in the production of both goods compared to China,

-The figure above shows a production possibilities frontier.In the figure,which of the following combinations of the two goods are efficient?

To find the opportunity cost of producing one more unit of any product while on the production possibilities frontier requires

Getting Started

The Usand Global Economies

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

Exam 3: The Economic Problem

The production possibilities frontier is the boundary between the

-The figure above shows a production possibilities frontier.In the figure,which of the following combinations of the two goods cannot be produced with the current resources and technology?

Having a comparative advantage means a nation can

-Robinson Crusoe divides his time between catching fish and gathering fruit.Part of his production possibilities frontier is given in the above table.If Mr.Crusoe is on his PPF and he increases the amount of fruit he gathers from 56 to 90 pounds,the opportunity cost is

-The table above gives the production possibilities frontier for two countries,Anaconda and Bear.The opportunity cost of moving from production point B to production point C for Anaconda equals ________ and for Bear equals ________.

If an economy cannot produce more of one good without producing less of another good,this implies that which of the following has been achieved?

-The table above shows the amounts of cloth and cheese that China and Pakistan can produce in an hour.Which country has the comparative advantage in cloth and which country has the comparative advantage in cheese?

The United States can use all its resources to produce 250 DVDs or 500 shoes.China can use all of its resources to produce 30 DVDs or 300 shoes.The opportunity cost of producing a DVD in the United States is

-The table above shows a production possibilities frontier for an economy.Which of the following combinations is unattainable?

What is gained when people engage in specialization and trade?

-The above figure shows the production possibility frontier for a country.Suppose the country is producing at point D.What would be the opportunity cost to move to point C?

If the production possibilities frontier between bottled water and water in a jug is a straight line,which of the following statements would be correct?

A bowed out production possibilities frontier shows

A bowed out production possibility frontier shows that the

When a nation is producing on its production possibilities frontier,if more resources are used to produce one good,then the production of other goods

Consider the United States' production of soy beans and running shoes.If the United States has an absolute advantage in the production of both goods compared to China,

-The figure above shows a production possibilities frontier.In the figure,which of the following combinations of the two goods are efficient?

To find the opportunity cost of producing one more unit of any product while on the production possibilities frontier requires

Getting Started

The Usand Global Economies

Demand and Supply

Elasticities of Demand and Supply

Efficiency and Fairness of Markets

Government Actions in Markets

Global Markets in Action

Externalities: Pollution, education, and Health Care

Production and Cost

Perfect Competition

Monopoly

Monopolistic Competition and Oligopoly

Gdp: a Measure of Total Production and Income

Jobs and Unemployment

The Cpi and the Cost of Living

Potential Gdp and Economic Growth

Money and the Monetary System

Aggregate Supply and Aggregate Demand

Fiscal Policy and Monetary Policy

Filters

-The table above gives the production possibilities frontier for two countries,Anaconda and Bear.The opportunity cost of moving from production point B to production point C for Anaconda equals and for Bear equals .