Exam 2: The Economic Problem: Scarcity and Choice

Refer to the information provided in Figure 2.4 below to answer the questions that follow. Figure 2.4 -According to Figure 2.4, as the economy moves from Point E to Point A, the opportunity cost of hybrid cars, measured in terms of motorcycles,

An economy in which individual people and firms pursue their own self-interest without any central direction or regulation is a(n)

In economics, the creation of capital is referred to as

A decrease in the stock of capital will cause the

All the combinations of goods and services that can be produced if all of society's resources are used efficiently are represented on an economy's

If an economy begins to use its resources more efficiently, it will move

An increase in the stock of capital will cause the

The concept of trade-offs would become irrelevant if

An institution through which buyers and sellers interact and engage in exchange is

Which of the following would an economist classify as capital?

The process of using resources to produce new capital is

According to the theory of ________, specialization and free trade will benefit all trade partners, even when some are absolutely more efficient producers than others.

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 2.6 below to answer the questions that follow. Figure 2.6 -Refer to Figure 2.6. Which of the following is most likely to shift the production possibility frontier from ppf^{2 to ppf1}?

If scarcity was eliminated,

Refer to the information provided in Figure 2.1 below for the economy of Macroland to answer the questions that follow. Figure 2.1 -Refer to Figure 2.1. If Macroland's economy is at Point A, it could produce more consumer goods

Consumer sovereignty

Combined, local, state, and federal governments in the United States directly employ about ________ percent of all workers.

Refer to the information provided in Figure 2.4 below to answer the questions that follow. Figure 2.4 -According to Figure 2.4, as the economy moves from Point D to Point B, the opportunity cost of hybrid cars, measured in terms of motorcycles

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?