Exam 3: The Fundamental Economic Problem Scarcity and Choice

Economic growth solves the problem of scarcity.

Opportunity costs exist for

In Table 3-2,from point C,the opportunity cost of 3 more units of cotton would be

If the economy of Gwondanaland is growing more rapidly than the economy of Japan,most likely

Inputs in production processes are called resources.

The principle of comparative advantage helps explain trade between nations.

Why might the money price for something be higher than the opportunity cost? Why might it be lower? Give an example of each to illustrate your answer.

Being on the PPF implies that increasing the production of one good or service can only be accomplished by decreasing the quantity produced of another good or service.

If a farmer's opportunity cost of producing 50,000 bushels of wheat is 20,000 fewer bushels of soybeans,then her opportunity cost of producing 50,000 bushels of soybeans must also be 20,000 fewer bushels of wheat.

The definition of efficiency implies that production is carried out on the production possibilities frontier.

Voluntary exchange results in mutual gains.

Efficient production can be carried out anywhere on or below the production possibilities frontier.

A decrease in the unemployment rate will shift the PPF outward from the origin.

In a properly functioning economy,money costs approximate opportunity costs.

Which of the following is a listing of the types or categories of resources?

A principle that economists emphasize is that the ____ of decision makers are always limited.

Probably the most important source of efficiency in production is

The idea of opportunity cost is relevant

Is faster economic growth unambiguously better?

A point lying inside (under)a production possibilities curve indicates that