Exam 2: The Economic Problem: Scarcity and Choice

When an economy is producing inside its production possibility frontier,

Refer to the information provided in Figure 2.4 below to answer the questions that follow. Figure 2.4 -According to Figure 2.4, Point A necessarily represents

In a command economy, ________ establish(es) what will be produced and when, set(s) production goals, and make(s) rules for distribution.

An economy in which a central authority draws up a plan that establishes what will be produced and when, sets production goals, and makes rules for distribution is a

Periods of less than full employment correspond to

Refer to the information provided in Figure 2.4 below to answer the questions that follow. Figure 2.4 -According to Figure 2.4, the point where only hybrid cars are produced is

Price is the coordinating mechanism in a laissez-faire economy.

A society can produce two goods: donuts and beer. The society's production possibility frontier is negatively sloped and "bowed outward" from the origin. As this society moves up its production possibility frontier, producing more and more units of donuts, the opportunity cost of producing beer

From 1935 to 2009, the yield per acre for wheat has ________ in the United States.

Saving is an example of

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

A laissez-faire economy is one in which individual people and firms pursue their own self-interest without any central direction or regulation.

Refer to the information provided in Table 2.1 below to answer the following questions. Table 2.1 -Refer to Table 2.1. For Krystal, the opportunity cost of writing one TV commercial is

Refer to the information provided in Figure 2.4 below to answer the questions that follow. Figure 2.4 -According to Figure 2.4, Point E necessarily represents

Refer to the information provided in Figure 2.4 below to answer the questions that follow. Figure 2.4 -According to Figure 2.4, an increase in unemployment may be represented by the movement from

The concept of opportunity cost is based on the principle of

During the Iraq War, many of Iraq's oil refineries were destroyed. This would best be represented by a

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

Which of the following would an economist classify as capital?

The production possibility frontier is a graph that shows