Exam 2: The Economic Problem: Scarcity and Choice

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. The marginal rate of transformation in moving from Point B to Point A is

The freedom of individuals to start and operate private business in search of profits is known as

Production inefficiency occurs

If a vintner has a comparative advantage in producing wine,

Refer to the information provided in Figure 2.3 below to answer the question(s) that follow. Figure 2.3 -Refer to Figure 2.3. Increasing opportunity costs are best depicted by the production possibility frontier in Panel

Which of the following is an element of a command economy?

Refer to the information provided in Figure 2.2 below for the economy of Microland to answer the question(s) that follow. Figure 2.2 -Refer to Figure 2.2. If Microland's economy is at Point B, it could produce more capital goods

A society can produce two goods: green tea and vitamin water. As this society moves down its production possibility frontier, producing more and more units of vitamin water, the opportunity cost of producing vitamin water increases. The society's production possibilities frontier will be

Assume a society can produce either olives or grapes. If the marginal rate of transformation of bushels of olives into bushels of grapes is 0.2, then the opportunity cost of grapes is

Which of the following does not constitute an act of "investment" as economists use the term?

If an economy is fully utilizing its resources, it can produce more of one product only if it

Refer to the information provided in Figure 2.2 below for the economy of Microland to answer the question(s) that follow. Figure 2.2 -Refer to Figure 2.2. Microland is currently operating at Point B. You correctly deduce that

Consider two countries, Estonia and Ukraine. Estonia devotes a larger portion of its production to capital. All other things equal, which of the following statements is most likely true?

In a laissez-faire economy, what provides individuals the information needed to make decisions?

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. For Molly, the opportunity cost of designing one tattoo is

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 -Refer to Figure 2.1. If Macroland's economy is at Point A, it could produce more capital goods

Among the resources used in production are labor and capital.

As more of a good, such as television sets, is produced, the opportunity costs of producing it increases. This most likely occurs because

As you move up the production possibility frontier, the absolute value of the marginal rate of transformation

Refer to the information provided in Figure 2.6 below to answer the question(s) that follow. Figure 2.6 -Refer to Figure 2.6. An increase in the economy's capital stock is represented by a