Exam 2: The Economic Problem

A factor market is a market in which

The PPF shifts if

Susan likes to drink sodas.The ________ soda Susan drinks,the ________ of the last soda.

When the opportunity cost of producing more of a good is increasing,the marginal cost of producing more of the good is

Both Mergatroid and the Geebocks produce only gizmos and widgets.It is possible for Mergatroid to have

Consider a PPF for tapes and soda.If the opportunity cost of a tape increases as the quantity of tapes produced increases and also the opportunity cost of a soda increases as the quantity of soda produced increases,then the PPF between the two goods will be

-According to the diagram in the above figure,what is the marginal benefit of consuming the 3 millionth gallon of gasoline per month?

-According to the diagram in the figure above,what is the marginal cost of producing the 3 millionth gallon of gasoline per month?

"Allocative efficiency requires that the maximum number of people have access to all of the goods and services that our economy produces." Is this statement true or false? Explain your answer.

-In one day,Brandon can either plow 10 acres or plant 20 acres.In one day,Christopher can either plow 14 acres or plant 14 acres.Brandon and Christopher can

Consider a production possibilities frontier with corn on the vertical axis and cars on the horizontal.Unusually good weather for growing corn shifts

-The above figure illustrates Mary's production possibilities frontier.Which of the following movements show opportunity costs increasing?

Allocative efficiency occurs when it is

If a society is operating at a point inside its production possibilities frontier,then this society's

-The figure above shows Freda's PPF.Freda currently produces 10 packets of fudge and no cookies.If Freda decides to produce 1 packet of cookies,her opportunity cost of the packet of cookies is ________ of fudge.

At the current point of production on a nation's production possibilities frontier,the marginal benefit of a slice of pizza is 500 tacos per slice of pizza while the marginal cost of producing a slice of pizza is 750 tacos per slice of pizza.To be allocatively efficient,what should be done?

-In the figure above,what can be said about point B?

Sam's production possibilities frontier has good A on the horizontal axis and good B on the vertical axis.If Sam is producing at a point inside his frontier,then he

Because of the existence of comparative advantage,the total output of goods is higher when each producer

Moving along a PPF,marginal cost is