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| Which of the following trade-offs does the production possibilities frontier illustrate? | Once an economy has reached the efficiency in production, then it must sacrifice equality in consumption |
| Which point on the graph best represents the fact that, because resources are scarce, not every conceivable outcome is feasible? | Point L |
| When you calculated your true costs of going to college, what portion of your room-and-board expenses should you included? | you should iinclude only the amount by which your room-and -board expenses for rent and food if you were not in college |
| The production possibilities frontier is a graph that shows the various combinations out output that an economy | can produce |
| If the government were to intervene and set prices of a dozen eggs above the market price, then we would expect, relative to the market outcome. | a decrease in the number of eggs people want to buy and increase in the number of eggs farme rwant to selll |
| In a circular- flow diagram, which of the following items flows from households to firms through the markets for the factors of production? | land, labor, and capital |
| The relatively low inflation experienced in the United States in 1990s is attributable to | slow grow of the quantity of money in the U.Sin the 1990s. |
| Microeconomics | is the study if how households an firms make deicions an how they interact specific ( true) |
| Points on the production possibilities frontier efficient levels of productions | True |
| AN outcome is said to to be efficient if an economy is getting all it can from the scarce resources it has available | |
| Points A, B, and D represent efficient outcomes for this economy | False,only A and D |
| In the circular-flow diagram, one loops represents the flow of goods, services, and factors of production, and the other loop represents the corresponding flow of dollars | true |
| Economist often find it worth while to make assumptions that do not necessarily describe the real world | true |
| The U.S. should not restrict employers from outsourcing work to foreign countries is normative statemtns | true |
| Economics is the study of how evenly goods and services are distributed within a society | false |
| Scarcity means that there is less of a good or resource available than people wish to have | true |
| When economists are trying to explain the world, they are scientists, and when they are trying to help improve the world, they are policy makers | true |
| Some countries win international trade, while other countries lose. | false |
| At the equilibrium price, quantity demanded is equal to quantity supplied | true |
| It takes Anne 3 hours to make a pie and 4 hours to make a shirt. It takes Mary 2 hours to make a pie and five hours to make a shirt. Anne should specialize in making shirts and Mary should specialize in making pies, and they should trade | true |
| Henry can make a bird house in three hours and he can make a bird feeder in one hour. The opportunity cost to Henry of making a bird house is 1/3 bird feeder | |
| If baked potatoes and sour cream are complements, then an increase in the price of sour cream decrease demand for baked potatoes | true |
| Goods produced aboard and sold domestically are called imports and goods produced domestically and sold aboard are called imports | false |
| Production possibilities frontiers cannot be used to illustrate trade-offs | false |
| In market, the price of any goods adjust until quantity demanded equals supplied | true |
| An increase in the price of a substitute good will shift the demand curve for a good to the right | true |
| Unless two people who are producing two goods have exactly the same opportunity costs, then one person will have comparative advantage in one good, and other person will have comparative advantage in the other good | |
| Assume the Antigua and Bardua each has 60 minutes available. If each island spends all its time producing the goods in which is has comparative advantage. then total production | |
| Kara receives a promotion at work, which increases hr income. We owuld epxect Kara's demand for | inferior goods to decrease |
| Min has an absolute advantage in the production of | plates and a comparative advantage in the production of plates |
| In competitive markets | firms produce identical products |
| Ken and Traci are two woodworkers who both make tables and chairs. In one month, Ken can make three tables or 18 chairs, wheras traci can make 8 tables or 24 chairs | traci has an absolute advantage in chairs |
| At the equilibrium price, the quantity of the good that buyers are willing and able to buy | exactly equal the quantity that sellers are willing and able to sell |
| Falda has a comparative advantge in the production of | wheat |
| Which of the following is not held constant in the a demand schedule? | price |
| a country that currently does not trade with other countries could benefit by | promoting imports and restricting exports |
| Assume that the farmer and the rancher each has 40 labors hours available. If he divideds his time equally between the proudction of meat and potatoes, then total production is | 7.5 pounds of mean and 6 pounds of potatoes |
| When the government imposes a binding price ceiling in a competitive market, s surplus f the good arises, ad seller must ration the scarce goods among the large number of potent ion buyers. | false |
| The economy contains many labors markets for different types of workers | true |
| if the government places a $2 tax in the market, the buyers pays $6 | true |
| The OPEC oil cartel has difficulty mainting high prices in the long run because the supply of oil is more inelastic in the long run than in the short run | false |
| At the equilibrium price, the quantity that buyers want ot buy exactly the quantity that sellers want to sell. | |
| Suppose that when the price rises by 20 percent for a particular good, the quantity ddemanded of that good falls by ten percent. The price elasticity of demand for this good is equal 2.0 | false |
| The tax birden falls more heavily on the side of the market that is more inelastic | |
| If a tax is imposes on the sellers of a product, then the tax burden will fall entirely on the sellers | true |
| Regardless of whether a tax is lecied on sellers or buyers, taxes ecnourafe market acitvity | true |
| The price of elasticity if demand is definf as the percentage change in quantity demanded divided by the percentage change in price | true |
| A legal maximum on the price at which good can be sold is called | ceiling |
| the buyers will bear a high share of the tx burden than sellers if the demand is | D2 and the supply is $2 |
| A tax on the sellers of coffee will increase the price of the coffeepaid by buyers | decreases the effective price of coffee received by sellers and decrease the equilibrium quantity of coffee |
| the price of elasticity of demand for a good is 5, then a 10 percent in price results in a | 50 percent decrease in the quantity demanded |
| Relative to a situation in which gasoline is not taxed, the imposition of a tax on gasoline causes the quantity gasoline demanded to | decrease and the quantity of gasoline to decrease |
| Concerning the labor market and taxes on the labor, economists disagree about | the the size of the deadweight loss of the tax on labor |
| Panela ( a) and Panela ( b) each illustrate a $4 placed on a market. In comparison to a Panel ( a), pAnela ( B) illustrates which if ht fowlloing statemtns | the demand is relatively inelastic, the dead-weight loss of a tax is smaller than when demand is relatively elastic |
| The invisible hand | a concept developed by Adam Smith to describe the virtues of free markets |
| If producer surplus is %19, then the price of the good is | 13.5 |
| Which of the following is not true | all above is correct |
| suppose a tax is of%1 per unit is imposed on a good. the more elastic the supply of the good, other things equal, the | larger deadwigh loss of the tax |
| A tax on buyers of tuxedoes shifts the | demand curve for tuxedos downward, decreasing the price received by sellers of tuxedoes aned causing the quantity of tuxedoes to decrease |
| If the labor supply curve is very elastic, a tax on labor | has a large deadwight loss |
| which of the follwoing statments is correc regarding a tax on a good and the resulting daedwight loss | the greater are the price of elasticity of supply and demand, the greater is the dead wight loss. |
| the greater the elasticity of demand, the smaller the deadwiehgt loss of a tax | false |
| taxes cause deadwight losses they prevent buyers and sellers from realizing some of the gains from | true |
| Taxes cause deadwight losses they prevent buyers and sellers from realizing some of the gains fro, | true |
| Producer surplus is the cost of production minus the amount of a seler is paid | false |
| At any quantity, theprice given by the supply minus the amount a seller is paid to buyers and sellers | false |
| A buyer is willing to a buy a product at a price greater than or equal to his willingness to pay, but wuld refuse to buy a product at aprice less than his willingness ot pay | false |
| the equlibrium of suply and deam curves in the market for cigarettes affetct how much a tax disorts that market | true |
| UNless markets are perfectly competitive, they may fail to maximize the total benefits | true |
| the elasticities of the supply and demand curves in the makrt for cigarettes affect how much a tax disorts that | true |
| consumer surplus can me be meausred as the area between the deamnd curve and the equilibrium price | true |
| Taxes affect the market participants byincreasing the price paid by the buyers and dec | true |
| " trade raises the economics well- being of a nation in the sense.. | false |
| GDP excludes the value of intermediate goods | true |
| The GDP delafotr can be used ti take inflation out of nominal GDP | true |
| If Brazil bys 100 | false |
| GDP is goodmeasure | false |
| New home construction is included it he concumption component of GDP | false |
| Willaim and Jamela live in the country of Dumexia | false |
| The output of goods and service producedin the UNited States | true |
| Ecoonomists view free trade | true |
| Real GDO per person tells income and epxediture | true |
| Rocket Energy Drink Company | bothe the increadedand inccreadeof suagee and energy drinks |
| What is a country A's consumption | 3311 |
| For any countruy, if the workld rpice of copper is lwer than the domestic price of copper without ade | import copper |
| the amount of gioverment revenue | E |
| In comuting GDP, makret prices are used to value final goods and service ebcause | market prices relfect tje values of goods ansd services |
| Suppose a certain country imooises a tariff on a good | a manufacturer produces 1 million tlevisions in the first quater |
| A manufacture orideuce 1 million televsions | the telvelsiosn will be countrd asa change in the first quater and the first quater GDP |
| Net exports = | epxorts minus importn |
| The princpal of comaprtative advanteage | countries can become better off by specialzing in what they od best |
| One should be especially wary of the national- security argument | representive of industry |
| higher growth rate in the last 120 years | |
| natural resousr had become scareer | the demand for the resource has decreased and the supply of the resource is unchanged |
| A rapid increaseint he number of worker | raise real GDP and decrease real GDP per person |
| if your firm;s production function has constant return too scale | increase by 60 percent |
| suppose Olivia 2009 clothing epxenditre | 150 |
| Which of the following is an example of a nonrenewable resource | oil |
| If the nominal nterest rate is 5 percet and the real interest is rate is 2 percent, then the inflation rate is 3 perecnt | true |
| changed in spi and producer price indev | false |
| like physical capital, human capital | true |
| if the vfalue of rhe consumer rice indev is 110 | false |
| If the current year is CPI is 90m then the price level | true |
| Bob deposits 100 in a bank | true |
| If per capita real income grown by 2 percent per yearm then it wull doubke in approcimatley 20 years | false |
| Bob depsits 100 in a bank account that pays an annual interest of 5 percent | false |
| I(f per capita real income grows 2 percent | false |
| the population growth rate tends to be high in developed countries than in developing countries | false |
| the GDP delflator relects the prices of all godds and service priduced arund the world | false |
| The U.S income tax system is | false |
| Assume taht the reserve requieremnt is 5 percent | chane in money supply increade with the creation of new money when the fed bus bonds. the 2,00o from the cookie jad is laread part of the money supply |
| sUPPOSE THE RESERE REQUIRMENT FOR A CHECKING IS 10 OERCENT | IF THE FED SELLD BOINDS, THEN THE BANK GIVE THEIR CASH FOR BONDS ANDTHEIR CASH RESERVE DEVCLINES |
| what ot do with excesss resver | pay for day to day operation, pay for customers transaction, to make change for bank customrer, to cash checks |
| what is the overall change in the mm and the ms | decrease int eh reserve by five persentis exactly offsets nu the banks decision to hold that increase as excess reserves. As areault , there i nt change in themoney multiples and not change the money supply |
| If the fed ne reaises reserve requiremnt | money supplier will decrease |
| Asume that the reserve reuqierment is 20 perect. also assume that the banks | the Fed has to buys bonds to give the banks cash, which replaces their bomd holding, which in turn rpovides rreal incentice to make oloans as cash, whichunlike the bonds, proved no interest income |
| What quantity of binds dies the Fed bneed tobuy r sell to accopmoish the goal states in Quesiton 9? | the value represnts the total value of bind purchases by the fed from the banking syste, |
What trade
The Production Possibilities Curve (PPC) is a model used to show the tradeoffs associated with allocating resources between the production of two goods. The PPC can be used to illustrate the concepts of scarcity, opportunity cost, efficiency, inefficiency, economic growth, and contractions.
How can the PPF illustrate trade
Opportunity cost can be illustrated by using production possibility frontiers (PPFs) which provide a simple, yet powerful tool to illustrate the effects of making an economic choice. A PPF shows all the possible combinations of two goods, or two options available at one point in time.
What are examples of trade
In economics, a trade-off is defined as an "opportunity cost." For example, you might take a day off work to go to a concert, gaining the opportunity of seeing your favorite band, while losing a day's wages as the cost for that opportunity.
What is trade off in production?
In economics, the term trade-off is often expressed as opportunity cost. A trade-off involves a sacrifice that must be made to obtain a desired product or experience. Understanding the trade-off for every decision you make helps ensure that you are using your resources (whether it's time, money or energy) wisely.