Exam 3: The Fundamental Economic Problem: Scarcity and Choice

What is the opportunity cost of economic growth?

If an economy is operating inefficiently, then

Figure 3-2 -In Figure 3-2, a point such as D

In a market system, the major coordination tasks are carried out

Which of the following is considered by economists to be the most fundamentally scarce?

Do all valuable items have price tags?

Draw a production possibilities frontier for an economy, with the axes labeled "military goods" and "peace goods." Indicate the region that is attainable and the region that is not.Explain the shape of the curve-what assumptions did you make in drawing it?

Money costs and opportunity costs are concepts that are

Do markets solve all of society's problems?

In an attempt to boost enrollment, in January, 1996, a private college in Iowa offered free tuition for graduating high school seniors from the county where it is located.For students who accepted the offer, how did this offer affect the opportunity cost of attending college?

Adam Smith's book, one of the first systematic treatments of economics, was entitled

-From the data given in Table 3-2, the opportunity cost of increased cotton in moving from A to B is

The production possibilities frontier has a tendency to bow outward from the origin.

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

In the Wealth of Nations, Adam Smith wrote about how countries could increase their consumption of goods and services through specialization and trade with other countries.

Figure 3-1 -According to Figure 3-1, the opportunity cost of one more bushel of wheat is

Is increased capital spending the only way for an economy to expand its production possibilities frontier?

Adam Smith noted that people are adept at pursuing their own self-interests, and that ____ harnesses this self-interest remarkably well.

Which of the following characteristics of a PPF indicates that tradeoffs must be made?

Inefficiency in an economy can be caused by