Exam 2: Trade-Offs, comparative Advantage, and the Market System

An increase in the unemployment rate may be represented as a movement from a point on the production possibilities frontier to a point inside the frontier.

When a celebrity has the desire to have his image protected following his death,this is best described as an example of the protection of

Economic growth is represented on a production possibilities frontier model by the production possibilities frontier

An increase in population shifts the production possibilities frontier inwards over time.

Which of the following statements is true about a simple circular flow model?

Table 2-8 Table 2-8 shows the output per month of two people,Wilma and Betty.They can either devote their time to making marble statues or making marble benches. -Refer to Table 2-8.What is Wilma's opportunity cost of making a bench?

In a free market there are virtually no restrictions,or at best few restrictions,on how a good or service can be produced or sold.

Which of the following statements about an entrepreneur is true?

Firms

Which of the following countries does not come close to the free market benchmark?

If a country is producing efficiently and is on the production possibilities frontier,the only way to produce more of one good is with an advance in technology.

Carmelita can perform either a combination of 35 manicures and 70 pedicures or a combination of 50 manicures and 45 pedicures.If she now performs 35 manicures and 70 pedicures,what is the opportunity cost of performing an additional 15 manicures?

Figure 2-4 Figure 2-4 shows various points on three different production possibilities frontiers for a nation. -Refer to Figure 2-4.Consider the following events: a.an increase in the unemployment rate B.general technological advancement C.an increase in consumer wealth Which of the events listed above could cause a movement from Z to V?

Figure 2-5 -Refer to Figure 2-5.If the economy is currently producing at point X,what is the opportunity cost of moving to point W?

In a two-good,two country world,if one country has an absolute advantage in the production of both goods,it can still benefit by trading with the other country.

Increasing marginal opportunity cost implies that

Any output combination along a production possibility frontier is associated with overused or unattainable resources.

Figure 2-7 Apple recently announced that the company is exploring the electric vehicle market,and is looking to produce vehicles as early as 2020.Assume Apple chooses to produce both traditional electric-engine vehicles and self-driving electric-engine vehicles.Figure 2-7 shows changes to its production possibilities frontier in response to new developments and different strategic production decisions. -Refer to Figure 2-7.Suppose worker productivity increases so that the total number of vehicles produced increases as the company adds more machinery,workers,and changes the layout of the factory.This is best represented by the

Which of the following would shift a nation's production possibilities frontier outward?

A welding machine is an example of a factor of production if it is being used to produce automobiles.