Exam 2: The Economic Problem: Scarcity and Choice

An economy that is producing on the production possibility frontier at some point other than the output of efficient allocation is

Refer to the information provided in Table 2.2 below to answer the following question(s). Table 2.2 Molly Pete Avatar Desigrn 6 3 Tattoo Desigri 3 2 -Refer to Table 2.2. Which of the following statements is true?

In terms of the production possibility frontier, ________ would best be shown by the production possibility frontier shifting outward.

Refer to the information provided in Figure 2.5 below to answer the question(s) that follow. Figure 2.5 -Refer to Figure 2.5. For this economy to move from Point B to Point C so that an additional 20 OLED televisions could be produced, production of LCD televisions would have to be reduced by

An economy in which a central authority draws up a plan that establishes what will be produced and when, sets production goals, and makes rules for distribution is a

Saving is an example of

If resources are combined efficiently in production, then the society

The process by which resources are transformed into useful forms is

No market economies exist without government involvement and government regulation.

The marginal rate of transformation is the

The market system works by getting each person, motivated by his or her own self-interest, to produce products for other people.

Specialization and trade exploit differences in productivity across workers and

Refer to the information provided in Figure 2.1 below for the economy of Macroland to answer the question(s) that follow. Figure 2.1 -The production possibility frontier is used to illustrate the concept of

Comparative advantage refers to the ability to produce better quality goods than a competitor.

Refer to the information provided in Figure 2.3 below to answer the question(s) that follow. Figure 2.3 -A society can produce two goods: donuts and beer. The society's production possibility frontier is negatively sloped and "bowed outward" from the origin. As this society moves up its production possibility frontier, producing more and more units of donuts, the opportunity cost of producing beer

Economic growth most likely occurs when

The idea that consumers ultimately dictate what not to produce by choosing what not to purchase is known as

Refer to the information provided in Figure 2.4 below to answer the question(s) that follow. Figure 2.4 -According to Figure 2.4, a decrease in unemployment may be represented by the movement from

Refer to the information provided in Figure 2.4 below to answer the question(s) that follow. Figure 2.4 -According to Figure 2.4, Point A necessarily represents

Price is the coordinating mechanism in a planned economy.