Question 1

Moving along the production possibilities frontier itself illustrates

Accepted Answer

A)   the existence of tradeoffs.
B)   the existence of unemployment of some factors of production.
C)   the benefits of free lunches.
D)   how free lunches can be exploited through trade.
E)   how tradeoffs need not occur if the economy is efficient.F) A) and D)
G) A) and E)

Question 2

-The figure above shows a production possibilities frontier.In the figure, the economy faces a tradeoff when ________ cell phones and ________ DVDs.are produced.

Accepted Answer

A)   3 million; 9 million
B)   2 million; 9 million
C)   3 million; 8 million
D)   4.5 million; no
E)   5 million; 15 millionF) D) and E)
G) B) and E)

Question 3

-The figure above shows the production possibilities frontier for a country.In order for it to move from producing at point A to producing at point B, the country would need to

Accepted Answer

A)   decrease SUV production by 1 million.
B)   decrease SUV production by 3 million.
C)   decrease SUV production by 4 million.
D)   decrease compact car production by 3 million.
E)   acquire more resources and/or more advanced technology.F) A) and C)
G) A) and D)

Question 4

-The above figure shows the production possibility frontier for a country. Suppose the country is producing at point A. What would be the opportunity cost to increase the production of rice to 12 tons?

Accepted Answer

A)   6 thousand bottles of wine
B)   15 thousand bottles of wine
C)   Nothing, it is a free lunch
D)   9 thousand bottles of wine
E)   6 tons of riceF) D) and E)
G) B) and D)

Question 5

What is the opportunity cost of economic growth?

Accepted Answer

A)   Consumption goods.
B)   Capital goods.
C)   Land.
D)   Both consumption and capital goods.
E)   Both capital goods and land.F) All of the above
G) B) and D)

Question 6

-Deb and Pete have volunteered to help their favorite charity mail out fundraiser information.The figure above shows their production possibilities frontiers for assembling packets and stuffing envelopes.Which of the following statements is correct?

Accepted Answer

A)   Deb has a comparative advantage in assembling packets.
B)   Pete has an absolute advantage in both assembling packets and stuffing envelopes.
C)   Deb has a comparative advantage in stuffing envelopes.
D)   Deb has an absolute advantage in both assembling packets and stuffing envelopes.
E)   Deb has a comparative advantage in both assembling packets and stuffing envelopes.F) C) and D)
G) B) and C)

Question 7

To increase its economic growth, a nation should

Accepted Answer

A)   limit the number of people in college because they produce nothing.
B)   encourage spending on goods and services.
C)   encourage education because that increases the quality of labor.
D)   increase current consumption.
E)   eliminate expenditure on capital goods.F) A) and B)
G) C) and D)

Question 8

When drawing a production possibilities frontier, which of the following is held constant?

Accepted Answer

A)   the amount of money in the economy
B)   the available factors of production and the state of technology
C)   the prices of goods and services
D)   the quantity of the goods and services that are produced
E)   None of the above because nothing is held constant when drawing the production possibilities frontier.F) A) and B)
G) B) and E)

Question 9

"When a person has an absolute advantage in producing a good, the person necessarily has a lower opportunity cost of producing it." Is this assertion true or false?

Accepted Answer

The assertion is incorrect.An absolute a...

Question 10

A production point beyond the production possibilities frontier represents what?

Accepted Answer

A production point beyond the ...

Question 11

-The figure above shows how the PPF for cell phones and new cell-phone factories can expand.In the figure, if the economy chose the point on this year's PPF that is above point K, the next year's PPF would

Accepted Answer

A)   shift outward along the horizontal axis farther than the new PPF shown in the figure.
B)   shift outward along the horizontal axis, but not as far as the new PPF shown in the figure.
C)   shift outward along the vertical axis, not along the horizontal axis.
D)   shift inward along the horizontal axis.
E)   shift inward along the vertical axis.F) C) and D)
G) A) and D)

Question 12

In a production possibilities frontier graph, the cost of producing more units of a good is measured by the

Accepted Answer

A)   dollar value of the resources used to produce the good.
B)   amount of the other good or service that must be forgone.
C)   dollar value of the additional output.
D)   area in the arc between the PPF and a straight line drawn between the starting point and the ending point.
E)   None of the above answers is correct.F) B) and E)
G) None of the above

Question 13

If Country A can produce an extra plane by giving up two boats, and Country B can produce an extra plane by giving up three boats, then

Accepted Answer

A)   Country A has a comparative advantage over Country B in the production of planes.
B)   Country B has a comparative advantage over Country A in the production of planes.
C)   the two countries have no incentive to trade with one another.
D)   Country A would like to trade with B, but B cannot gain by trading with A.
E)   Country A has an absolute advantage in producing planes and a comparative advantage in producing boats.F) A) and B)
G) C) and D)

Question 14

Possibility  Robots  Pizza A040B139C237D334E430F520G60\begin{array}{ccc}	ext { Possibility } & 	ext { Robots } & 	ext { Pizza } \\hline A & 0 & 40 \B & 1 & 39 \C & 2 & 37 \D & 3 & 34 \E & 4 & 30 \F & 5 & 20 \G & 6 & 0\end{array} Possibility ABCDEFG​ Robots 0123456​ Pizza 4039373430200​​ 
-The table above shows a nation's production possibilities frontier.The opportunity cost of a robot between combination D and E is

Accepted Answer

A)   4 pizzas.
B)   34 pizzas.
C)   30 pizzas.
D)   1/4 of a pizza.
E)   undefined because neither point is production efficient. F) A) and C)
G) A) and D)

Question 15

When one person's opportunity cost of producing a good is lower than another person's opportunity cost of producing the same good, it is called

Accepted Answer

A)   an absolute advantage.
B)   a comparative advantage.
C)   specialization.
D)   production possibilities.
E)   a trade off.F) B) and E)
G) A) and B)

Question 16

If a country is operating at a point of production efficiency,

Accepted Answer

A)   it enjoys a free lunch when increasing production.
B)   it produces on its production possibilities frontier.
C)   it must specialize in the production of a good.
D)   it operates on its trade line.
E)   it cannot be producing at its point of comparative advantage.F) C) and E)
G) A) and B)

Question 17

The fact of increasing opportunity cost when moving on the PPF means that

Accepted Answer

A)   to increase the production of one product requires larger and larger sacrifices of the other good.
B)   to decrease the production of one product requires smaller and smaller sacrifices of the other good.
C)   to increase the production of one product requires smaller and smaller sacrifices of the other good.
D)   when the government forces a movement from one point on the PPF to another point, no production is lost.
E)   the PPF will be a negatively sloped straight line.F) B) and E)
G) A) and B)

Question 18

-In the above figure, Jill's opportunity cost of producing 1 gallon of soda is ________ of bottled water.

Accepted Answer

A)   2 gallons
B)   1/2 of a gallon
C)   4 gallons
D)   1 gallon
E)   1/4 of a gallonF) A) and B)
G) D) and E)

Question 19

-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 DVDsF) C) and D)
G) B) and D)

Question 20

Economic growth depends upon which of the following?
I.Improving the quality of labor
Ii. Technological advancement
Iii. Increasing the amount of capital

Accepted Answer

A)   i only
B)   ii only
C)   iii only
D)   i and iii
E)   i, ii, and iiiF) A) and B)
G) B) and C)

Exam 3: The Economic Problem

Moving along the production possibilities frontier itself illustrates

Correct Answer
verified

-In the above figure, Jill's opportunity cost of producing 1 gallon of soda is ________ of bottled water.

Correct Answer
verified

-The figure above shows a production possibilities frontier.In the figure, the economy faces a tradeoff when cell phones and DVDs.are produced.

Correct Answer
verified

When one person's opportunity cost of producing a good is lower than another person's opportunity cost of producing the same good, it is called

Correct Answer
verified

What is the opportunity cost of economic growth?

Correct Answer
verified

Correct Answer
verified

-The figure above shows how the PPF for cell phones and new cell-phone factories can expand.In the figure, if the economy chose the point on this year's PPF that is above point K, the next year's PPF would

Correct Answer
verified

-Deb and Pete have volunteered to help their favorite charity mail out fundraiser information.The figure above shows their production possibilities frontiers for assembling packets and stuffing envelopes.Which of the following statements is correct?

Correct Answer
verified

If Country A can produce an extra plane by giving up two boats, and Country B can produce an extra plane by giving up three boats, then

Correct Answer
verified

Economic growth depends upon which of the following? I.Improving the quality of labor Ii. Technological advancement Iii. Increasing the amount of capital

Correct Answer
verified

-The above figure shows the production possibility frontier for a country. Suppose the country is producing at point A. What would be the opportunity cost to increase the production of rice to 12 tons?

Correct Answer
verified

A production point beyond the production possibilities frontier represents what?

Correct Answer
verified
A production point beyond the ...
View Answer

The fact of increasing opportunity cost when moving on the PPF means that

Correct Answer
verified

-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?

Correct Answer
verified

-The figure above shows the production possibilities frontier for a country.In order for it to move from producing at point A to producing at point B, the country would need to

Correct Answer
verified

To increase its economic growth, a nation should

Correct Answer
verified

In a production possibilities frontier graph, the cost of producing more units of a good is measured by the

Correct Answer
verified

"When a person has an absolute advantage in producing a good, the person necessarily has a lower opportunity cost of producing it." Is this assertion true or false?

Correct Answer
verified
The assertion is incorrect.An absolute a...
View Answer

When drawing a production possibilities frontier, which of the following is held constant?

Correct Answer
verified

If a country is operating at a point of production efficiency,

Correct Answer
verified

Exam 3: The Economic Problem

Moving along the production possibilities frontier itself illustrates

Correct AnswerverifiedShow Answer

-In the above figure, Jill's opportunity cost of producing 1 gallon of soda is ________ of bottled water.

Correct AnswerverifiedShow Answer

-The figure above shows a production possibilities frontier.In the figure, the economy faces a tradeoff when ________ cell phones and ________ DVDs.are produced.

Correct AnswerverifiedShow Answer

When one person's opportunity cost of producing a good is lower than another person's opportunity cost of producing the same good, it is called

Correct AnswerverifiedShow Answer

What is the opportunity cost of economic growth?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

-The figure above shows how the PPF for cell phones and new cell-phone factories can expand.In the figure, if the economy chose the point on this year's PPF that is above point K, the next year's PPF would

Correct AnswerverifiedShow Answer

-Deb and Pete have volunteered to help their favorite charity mail out fundraiser information.The figure above shows their production possibilities frontiers for assembling packets and stuffing envelopes.Which of the following statements is correct?

Correct AnswerverifiedShow Answer

If Country A can produce an extra plane by giving up two boats, and Country B can produce an extra plane by giving up three boats, then

Correct AnswerverifiedShow Answer

Economic growth depends upon which of the following? I.Improving the quality of labor Ii. Technological advancement Iii. Increasing the amount of capital

Correct AnswerverifiedShow Answer

-The above figure shows the production possibility frontier for a country. Suppose the country is producing at point A. What would be the opportunity cost to increase the production of rice to 12 tons?

Correct AnswerverifiedShow Answer

A production point beyond the production possibilities frontier represents what?

Correct AnswerverifiedA production point beyond the ...View AnswerShow Answer

The fact of increasing opportunity cost when moving on the PPF means that

Correct AnswerverifiedShow Answer

-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?

Correct AnswerverifiedShow Answer

-The figure above shows the production possibilities frontier for a country.In order for it to move from producing at point A to producing at point B, the country would need to

Correct AnswerverifiedShow Answer

To increase its economic growth, a nation should

Correct AnswerverifiedShow Answer

In a production possibilities frontier graph, the cost of producing more units of a good is measured by the

Correct AnswerverifiedShow Answer

"When a person has an absolute advantage in producing a good, the person necessarily has a lower opportunity cost of producing it." Is this assertion true or false?

Correct AnswerverifiedThe assertion is incorrect.An absolute a...View AnswerShow Answer

When drawing a production possibilities frontier, which of the following is held constant?

Correct AnswerverifiedShow Answer

If a country is operating at a point of production efficiency,

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

-The figure above shows a production possibilities frontier.In the figure, the economy faces a tradeoff when cell phones and DVDs.are produced.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A production point beyond the ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The assertion is incorrect.An absolute a...
View Answer

Correct Answer
verified

Correct Answer
verified