Question 1

You have an absolute advantage in producing something whenever:

Accepted Answer

A)  you enjoy producing that good. 
B)  you can produce more of it than someone else can using the same quantity of resources. 
C)  your opportunity cost is constant. 
D)  your opportunity cost is lower than that of other producers. 
E)  you have specific training in the production of that good. 
A)  you enjoy producing that good. 
B)  you can produce more of it than someone else can using the same quantity of resources. 
C)  your opportunity cost is constant. 
D)  your opportunity cost is lower than that of other producers. 
E)  you have specific training in the production of that good.

Question 2

As you move from one efficient point on the production possibilities frontier (PPF) to another efficient point on the PPF, you experience:

Accepted Answer

A)  decreasing relative cost. 
B)  opportunity cost. 
C)  macroeconomics. 
D)  unlimited resources. 
E)  unattainable combinations. 
A)  decreasing relative cost. 
B)  opportunity cost. 
C)  macroeconomics. 
D)  unlimited resources. 
E)  unattainable combinations.

Question 3

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between making pizzas and making stromboli. Refer to these figures to answer the next three questions.
 
-What is Jim's opportunity cost of making 1 stromboli?

Accepted Answer

A)  1/2 pizza 
B)  2/3 pizza 
C)  2 pizzas 
D)  2 stromboli 
E)  25 pizzas 
A)  1/2 pizza 
B)  2/3 pizza 
C)  2 pizzas 
D)  2 stromboli 
E)  25 pizzas

Question 4

Consider the following scenario to answer the  questions: Two friends, Rachel and Joey, enjoy baking bread and making apple pies. Rachel takes two hours to bake 1 loaf of bread and one hour to make 1 pie. Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie.
-What is Joey's opportunity cost of baking 1 pie?

Accepted Answer

A)  4 pies 
B)  2 pies 
C)  1 pie 
D)  1 loaf of bread 
E)  1/2 loaf of bread 
A)  4 pies 
B)  2 pies 
C)  1 pie 
D)  1 loaf of bread 
E)  1/2 loaf of bread

Question 5

Michael and Angelo are both artists who can create sculptures or paintings each day. The following table describes their maximum outputs per day. Use this table to answer the questions. $$\begin{array} { | l | l | l | } 
\hline & \text { Sculptures } & \text { Paintings } \
\hline \text { Michael } & 10 & 5 \
\hline \text { Angelo } & 6 & 2 \
\hline
\end{array}$$
-What is Michael's opportunity cost of a sculpture?

Accepted Answer

A)  2 paintings 
B)  1/2 painting 
C)  3 paintings 
D)  1/3 sculpture 
E)  1/2 sculpture 
A)  2 paintings 
B)  1/2 painting 
C)  3 paintings 
D)  1/3 sculpture 
E)  1/2 sculpture

Question 6

Is it always better to forgo current consumption in order to invest more in capital goods that will provide more growth in society's production possibilities frontier (PPF) and make us better off in the future?

Accepted Answer

No, it is not always better to forgo cur

Question 7

Consider the following scenario. Two friends, Rachel and Joey, enjoy baking bread and making apple pies. Rachel takes two hours to bake one loaf of bread and one hour to make one pie. Joey takes four hours to bake one loaf of bread and four hours to make one pie. If Rachel and Joey decide to specialize in order to maximize their combined output, who should produce what?

Accepted Answer

A)  Joey should specialize in making pies because he has an absolute advantage. 
B)  Rachel should specialize in making pies and Joey should specialize in making bread. 
C)  Joey should specialize in making pies and Rachel should specialize in making bread. 
D)  Rachel should specialize in making bread and pies because she has a comparative advantage in both. 
E)  Rachel should not specialize because she is better at producing both. 
A)  Joey should specialize in making pies because he has an absolute advantage. 
B)  Rachel should specialize in making pies and Joey should specialize in making bread. 
C)  Joey should specialize in making pies and Rachel should specialize in making bread. 
D)  Rachel should specialize in making bread and pies because she has a comparative advantage in both. 
E)  Rachel should not specialize because she is better at producing both.

Question 8

Which allocation point in the short-run production possibilities frontier (PPF) will lead to NO GROWTH in the long-run PPF?

Accepted Answer

A)  point A 
B)  point B 
C)  point C 
D)  point D 
E)  point E 
A)  point A 
B)  point B 
C)  point C 
D)  point D 
E)  point E

Question 9

Consider the following scenario to answer the  questions: Two friends, Rachel and Joey, enjoy baking bread and making apple pies. Rachel takes two hours to bake 1 loaf of bread and one hour to make 1 pie. Joey takes four hours to bake 1 loaf of bread and four hours to make 1 pie.
-What is Rachel's opportunity cost of baking 1 pie?

Accepted Answer

A)  2 pies 
B)  1 pie 
C)  1 loaf of bread 
D)  1/2 loaf of bread 
E)  2 loaves of bread 
A)  2 pies 
B)  1 pie 
C)  1 loaf of bread 
D)  1/2 loaf of bread 
E)  2 loaves of bread

You have an absolute advantage in producing something whenever:

As you move from one efficient point on the production possibilities frontier (PPF) to another efficient point on the PPF, you experience:

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between making pizzas and making stromboli. Refer to these figures to answer the next three questions. -What is Jim's opportunity cost of making 1 stromboli?

Michael and Angelo are both artists who can create sculptures or paintings each day. The following table describes their maximum outputs per day. Use this table to answer the questions. Sculptures Paintings Michael 10 5 Angelo 6 2 -What is Michael's opportunity cost of a sculpture?

Is it always better to forgo current consumption in order to invest more in capital goods that will provide more growth in society's production possibilities frontier (PPF) and make us better off in the future?

Which allocation point in the short-run production possibilities frontier (PPF) will lead to NO GROWTH in the long-run PPF?

The Five Foundations of Economics

The Market at Work: Supply and Demand

Elasticity

Price Controls

The Efficiency of Markets and the Costs of Taxation

Market Inefficiencies: Externalities and Public Goods

Business Costs and Production

Firms in a Competitive Market

Understanding Monopoly

Price Discrimination

Monopolistic Competition and Advertising

Oligopoly and Strategic Behavior

The Demand and Supply of Resources

Income, Inequality, and Poverty

Consumer Choice

Behavioral Economics and Risk Taking

Health Insurance and Health Care

Filters

Exam 2: Model Building and Gains From Trade

You have an absolute advantage in producing something whenever:

As you move from one efficient point on the production possibilities frontier (PPF) to another efficient point on the PPF, you experience:

The figures below depict the production possibilities frontiers (PPFs) for two people who can allocate the same amount of time between making pizzas and making stromboli. Refer to these figures to answer the next three questions. -What is Jim's opportunity cost of making 1 stromboli?

Michael and Angelo are both artists who can create sculptures or paintings each day. The following table describes their maximum outputs per day. Use this table to answer the questions. Sculptures Paintings Michael 10 5 Angelo 6 2 -What is Michael's opportunity cost of a sculpture?

Is it always better to forgo current consumption in order to invest more in capital goods that will provide more growth in society's production possibilities frontier (PPF) and make us better off in the future?

Which allocation point in the short-run production possibilities frontier (PPF) will lead to NO GROWTH in the long-run PPF?

The Five Foundations of Economics

The Market at Work: Supply and Demand

Elasticity

Price Controls

The Efficiency of Markets and the Costs of Taxation

Market Inefficiencies: Externalities and Public Goods

Business Costs and Production

Firms in a Competitive Market

Understanding Monopoly

Price Discrimination

Monopolistic Competition and Advertising

Oligopoly and Strategic Behavior

The Demand and Supply of Resources

Income, Inequality, and Poverty

Consumer Choice

Behavioral Economics and Risk Taking

Health Insurance and Health Care

Filters