But improvements in productive efficiency take time to discover and implement, and economic growth happens only gradually. a. the economy produces only two products. D. the economy produces only two products. creditors do not receive the full amount of the loan because the principle and interest rates are fixed. c. a downward-sloping convex curve. Which is the exception? (i), (ii) and (ii) c. (i) only. ", what does the term "marginal" mean in economics, an office supply store sells a ream of paper at a fixed price of $4.50. ANSWER: a. (2) The same resources can be used to produce either or both of the two goods and can be shifted freely between them. b. the level of technology is fixed and unchanging. The Production Possibilities Curve (PPC) is a model used to show the tradeoffs associated with allocating resources between the production of two goods. c. labor, capital, land and natural resources are fi xed in quantity. Which of the following is a factor of production? 1. outline four measures that may be taken to conserve forests in Kenya (4mks) 2. The production possibilities frontier model assumes all of the following except a. the economy produces only two products. production possibilities frontier, absolute and comparative advantage, the division of labor and the gains from specialization, and how economic systems answer the three economic questions of what, how, and for whom. As on PPF, the economy is at full employment, an increase in unemployment will not shift the PPF outward. B. a new hybrid for wheat is discovered. If you're seeing this message, it means we're having trouble loading external resources on our website. d. production of goods requires full employment of all resources. Why? If Resource Use Was Improved, The Economy Could Move Within The Production Possibilities Frontier. B) the economy produces only two products. any level of the two products that the economy produces is currently possible. 102. B) Is Caused By Inefficient Use Of Resources. The production possibilities frontier model assumes all of the following except... a. labor, capital, land and natural resources are fixed in quantity. (ii) only. A production possibility frontier is used to illustrate the concepts of opportunity cost, trade-offs and also show the effects of economic growth. 6) The production possibilities frontier assumes all of the following except A) labor, capital, land and natural resources are fixed in quantity. The production possibilities curve is also called the PPF or the production possibilities frontier. Demand and Supply Introduction to Demand and Supply 3.1 Demand, Supply, and Equilibrium in 3.2 Explain your answers briefly. b. the level of technology is fixed and unchanged. Assume that the resources best suited to producing a particular service are preferentially used in the production of that service and that as the economy moves down along the production possibilities frontier, one worker at a time is transferred from mowing lawns to washing cars. 11) 12)On the vertical axis, the production possibilities frontier shows _____; on the horizontal axis, the production possibilities frontier … 13. All of the following would tend to increase a nations production possibilities EXCEPT: A. the society becomes more accepting of women who work. In … A. Correct C. 1.The production possibilities frontier can be used to demonstrate which of the following? Alternatively, he can sell the weather vane without restoring it for $200. a. B) the points along the production possibilities frontier C) the points of the horizontal and vertical intercepts. _____ is (are) unattainable with current resources. From a microeconomics standpoint, a firm that operates efficiently: labor and capital, which are scarce in Economy A. D)makes her production possibilities frontier steeper. D) the points outside the production possibilities frontier. 3 rabbits, and 180 berries. scarcity refers to the situation in which, economics is the study of the ______ people make to attain their goals, given their ____ resources, a group of buyers and sellers of a product and the arrangement by which they come together to trade, the banks must have weighed the cost of installing bandit barriers against the benefits and decided that they have "no interest in ever putting in the barriers", In the first six months of 2003, branches of Commerce Bank in New York City were robbed 14 times. The following diagram (21.2) illustrates the production possibilities set out in the above table. d. a downward-sloping concave curve. B. market prices. which of the following is a term used by economists to describe the money received from the sale of an additional ream of paper, ______ involves undertaking an activity until its marginal benefits equal marginal costs, she should purchase the period fabric, complete the task and then sell the quilt. Why are imperfectly competitive markets inefficient? Courses. B)does not affect her production possibilities frontier. B) a market economy is more efficient in producing goods and services than is a centrally planned economy. (D) shifted. In this example, the two commodities that that country produces are food (F) and clothes (C). Principle #2 is also shown on the production possibilities frontier: The cost of something is what you give up to get it (opportunity cost). through an increase in supplies of factors of production. at a recent company meeting, geraldine erwin, sales manager of dastoria, a flavored beverage producer announced, "we have increases our sales by 8 percent in just six months." Figure 2 b. (b) What are the limits of the terms of trade between F, Questions. Course Hero is not sponsored or endorsed by any college or university. The production possibilities frontier model assumes all of the following except. D)opportunity What is the opportunity cost of buying a hand-rolled cigar? Question 1 3 out of 3 points The production possibilities frontier model assumes all of the following except Answer Selected Answer: C. Any level of the two products that the economy produces is currently possible. Which of the following is true about the comparative advantage between the two countries? Figure 2-1 is (are) inefficient in that not all resources are being (D) shifted. The four key assumptions underlying production possibilities analysis are: (1) resources are used to produce one or both of only two goods, (2) the quantities of the resources do not change, (3) technology and production techniques do not change, and (4) resources are used in a technically efficient way. switzerland has the comparative advantage in watches. B B) any level of the two products that the economy produces is currently possible. D) the level of technology is fixed and unchanging. (E) a straight diagonal line slopping downward from left to right. b. the level of technology is fi xed and unchanging. (a) The government decides to shorten the time period for unemployed w, Evaluate the following statements.True/False/It Depends? The principle of ________ is that the economic cost of using a factor of production is the alternative use of that factor that is given up. Since human wants are unlimited and the means to satisfy them are limited, every society is faced with the fundamental problem of choosing and allocating its scarce resources among alternative uses. (E) a straight diagonal line slopping downward from left to right. D. the nation decides (by whatever method) to increase production of investment goods and decrease production of consumption goods. B) the economy produces only two products. Q2. c. labor, capital, land and natural resources are fi xed in quantity. The law of increasing opportunity costs assumes that all people have the same ability to produce goods. c. labor, capital, land and natural resources are fixed in quantity. C. the level of technology is fixed and unchanging. b. an upward-sloping straight line. The frontier’s bowed … B) a market economy is more efficient in producing goods and services than is a centrally planned economy. (i) The best tradeoffs that individuals and societies should make (ii) The tradeoffs forced on individuals and societies because of scarcity (iii) The wealth maximizing output combination that an individual or society should choose . The production possibilities frontier model assumes all of the following except a. the economy produces only two products. he should finish the restoration and then sell the weather vane. 12. (B) convex to the origin. If the production possibilities frontier is linear, then, opportunity costs are constant as more of one good is produced. Suppose your expenses for this term are as follows: tuition: $9,000, room and board: $1,500, books and other educational supplies: $1,000. Further, during the term, you can only work partminus−time and earn $3,000 instead of your fullminus−time salary of $8,000. c. labor, capital, land and natural resources are fixed in They've told our detectives they have no interest in ever putting in the barriers. A] Under perfect capital markets, investor's choice between alt. The opportunity cost of increasing the production of cars from 600 to 700 is 200 computers. The production possibilities frontier, or PPF, shows the productive capabilities of an economy when all resources are used efficiently. In this example, let's say the economy can produce: 200 guns if it produces only guns, as represented by the point (0,200) 100 pounds of butter and 190 guns, as represented by the point (100,190) 250 pounds of butter and 150 guns, as represented by … To see this relationship more clearly, examine Figure 2.3 “The Slope of a Production Possibilities Curve”.Suppose Plant 1 is producing 100 pairs of skis and 50 snowboards per month at point B. The production possibilities frontier model assumes the economy produces only two products On the diagram, Point A is inefficient in that not all resources are being used. To construct a combined production possibilities curve for all three plants, we can begin by asking how many pairs of skis Alpine Sports could produce if it were producing only skis. bowed outward. (B) convex to the origin. The Stogie Shop, a cigar store in the mall, sells hand-rolled cigars for $10.00 and machine-made cigars for $2.50 each. C (a curved line has slope values that change at every point). there is a negative relationship between hybrid automobile prices and quantities purchases by consumers, suppose when the price of hybrid automobiles rises, consumers buy fewer hybrid automobiles. Production points inside the curve show an economy is not producing at its comparative advantage. 7) The production possibilities frontier assumes all of the following except A) labor, capital, land and natural resources are fixed in quantity ) the economy produces only two products. The production possibility curve or frontier is an analytical tool which is used to illustrate […] as population declines, scarcity eventually disappears, the highest valued alternative that must be given up to engage in an activity. C. To get out of a recession, we must produce at some point beyond our production possibilities frontier. According to a deputy commissioner of police, "Commerce does very little of what we recommend. 10) The production possibilities frontier model assumes all of the following except a. the economy produces only two products. The production possibility frontier assumes that production is operating at a maximum amount of productive efficiency. b. the level of technology is fixed and unchanging. Points within the curve show when a country’s resources are not being fully utilised. How can inefficiency occur in a perfectly competitive market? the ability to produce a good or service at a lower opportunity cost than any other producer. Answer: C 20) When moving along the production possibilities frontier, opportunity cost is measured as the Answer: B Chapter 3 Demand and Supply 1) The relative price of a good is Answer: A 2) All of the following statements are Consider Economy A, which only produces two goods (for simplicity): potatoes and carrots. B) … 5) The production possibilities frontier model shows that A) if consumers decide to buy more of a product its price will increase. Cassie has just spent $800 purchasing, cleaning and reconstructing an antique quilt which she expects to sell for $1,500 once she is finished. D. the distribution of income. every choice involves an opportunity cost, scarcity is central to the study of economics bc it implies that, Economists use the word "marginal" to mean an extra or additional benefit or cost of a decision. The production possibilities frontier model assumes all of the following except any level of the two products that the economy produces is currently possible. Germany can produce 1 watch for every 100 pounds of chocolate it produces. The production possibilities frontier can be used to illustrate all of the following concepts, except one. c. labor, capital, land and natural resources are fi xed in B) the economy produces only two products. C) any level of the two products that the The production possibility curve is based on the following Assumptions: (1) Only two goods X (consumer goods) and Y (capital goods) are produced in different proportions in the economy. 6) The production possibilities frontier model assumes all of the following except A) labor, capital, land and natural resources are fixed in quantity. It also assumes that the production of any one commodity will only increase if the production of another commodity decreases because of finite resources. The production possibilities frontier is used to illustrate the economic circumstances of scarcity, choice, and opportunity cost. The ________ production points on a production possibilities frontier are the points along and inside the production possibilities frontier. Economists assume that rational people do all of the following except a. use all available information as … the farm factory a booth at the local farmers market sells fresh eggs for $1.50 per dozen and fresh milk for $2.50 per gallon. C. consumer preferences. As it does, the production possibilities frontier for a society will tend to shift outward and society will be able to afford more of all goods. (C) undefined. calculate the percentage change in toothpaste consumption. The following graph shows the production possibilities frontier for a particular country’s economy. Therefore, the point on the PPF curve shows that all the resources are utilized efficiently. Suppose six months ago, its sales amounted to $452,000, what is the value of its sales today? A production possibilities frontier with a ________ shape indicates increasing opportunity costs as more and more of one good is produced. A) labor, capital, land and natural resources are fixed in quantity. 4) The production possibilities frontier model assumes all of the following, except A) labor, capital, land and natural resources are fixed in quantity. The production possibilities frontier, or PPF, shows the productive capabilities of an economy when all resources are used efficiently. The production possibility frontier assumes that production is operating at a maximum amount of productive efficiency. b. the economy produces only two products. The New York City Police recommended steps the bank could take to deter robberies, including the installation of plastic barriers called "bandit barriers." 5) The production possibilities frontier model shows that A) if consumers decide to buy more of a product its price will increase. If you're behind a web filter, please make sure that the domains *.kastatic.org and *.kasandbox.org are unblocked. D) all possible production of capital goods Answer: B Topic: Production Possibilities Frontier Skill: Conceptual 7) The production possibilities frontier itself shows A) the maximum amount of resources available at any given time. (A B C graph) Point C. A production possibilities frontier with a _____ shape indicates increasing opportunity costs as more and more of one good is produced. A. scarcity. All of the following are true for inflation EXCEPT that: ... Greg and Melissa face the production possibilities frontiers shown for biscuits and cookies. C) any level of the two products that the economy produces is currently possible. b. the level of technology is fi xed and unchanging. Without technological advancement, how can a nation achieve economic growth? After having spent $800, Cassie discovers that she would need some special period fabric that would cost her $200 in material and time in order to complete the task. For each watch that Switzerland produces, it gives up the opportunity to make 50 pounds of chocolate. Select one: a. Search. 6) The production possibilities frontier model assumes all of the following except A) labor, capital, land and natural resources are fixed in quantity. A correctly drawn production possibilities curve shows all of the following EXCEPT: a) 2 goods b) How scarce resources are allocated between 2 goods c) Opportunity cost d) Full employment of resources e) What resources are being allocated I said it was "B" but I was wrong. State four ways in which natural resources may be of bene, Can you please explain how to a) Plot Canada's production possibilities curve by plotting at least 3 points on the curve and b) How much of each good, How will the natural rate of unemployment be affected by the following changes? C) any l D) the level of technology is fixed and unchanging. b. the level of technology is fi xed and unchanging. The production possibilities frontier model assumes all of the following except. The unattainable points in a production possibilities diagram are the points outside the production possibilities frontier. Production possibility frontier (PPF) shows the combination of two goods which a nation can produce with the help of given technology,employment and other resources. The production possibilities frontier model assumes all of the following except A) labor, capital, land and natural resources are fixed in quantity. C. a government program is instituted that encourages college education. ADVERTISEMENTS: The Production Possibilities Curve: Assumption, Uses or Application! B. labor, capital, land and natural resources are fixed in quantity. The PPF is downward sloping because resources must be taken away from the production of one good in order to produce more of the other good. production levels, the productions possibilities frontier is (A) concave to the origin. The production possibilities frontier shows the _____ combinations of two products that may be produced in a particular time period with available resources . C) the level of technology is fixed and unchanging. When opportunity cost is constant across all production levels, the productions possibilities frontier is (A) concave to the origin. What After having spent $125, Zane realizes that he will need to spend an additional $200 on materials to complete the restoration. C (the janitor at the local elementary school). !1 Q1. b. the level of technology is fixed and unchanged. Assume that Greg and Melissa trade 60 biscuits for 60 cookies after they have completely specialized in producing the good in which they have a comparative advantage. It measures and visualizes the level of efficiency at which two different commodities can be produced together. B) the economy produces only two products. And that curve we call, once again-- fancy term, simple idea-- our production possibilities frontier. the maximum attainable combinations of two products that may be produced in a particular time period with available resources. With an optimal two-part tariff. B) the economy produces only two products. Zane's Vanes is a service that restores old weather vanes. 371,588 students got unstuck by CourseHero in the last week, Our Expert Tutors provide step by step solutions to help you excel in your courses. B)the exchange of one good or service for another. Question: 1.For An Economy, Operating Outside The Production Possibilities Frontier: A) Possible Only When People Cooperate With Each Other. which of the following is macroeconomics question? the more resources already devoted to any activity, the payoff from allocating yet more resources to that activity increases by progressively smaller amounts. What is his marginal benefit if he sells the weather vane without restoring it? The Production Possibilities Curve (PPC) is a model used to show the tradeoffs associated with allocating resources between the production of two goods. 8)A production possibilities frontier does NOTillustrate A)attainable and unattainable points. debtors are hurt during inflationary times because the amount they pay creditors back increases. If the output of military goods is increased, the output of civilian goods: must decrease When making a choice to do more of one activity, the highest-valued other choice society does not make is called_____, and it is measured_____. 2 rabbits and 240 berries. The police were surprised the bank did not take their advice. C)makes her production possibilities frontier flatter. A (any level of the two products that the economy produces is currently possible), The production possibilities frontier model assumes all of the following except ______. Cassie's Quilts alters, reconstructs and restores heirloom quilts. Suppose an excise tax of $1 is imposed on every case of beer sold and sellers are responsible for paying this tax. On the production possibilities frontier 95 percent of the labor force is employed. Maximum attainable. Both goods require two main inputs in order to be manufacturedEconomics of ProductionProduction refers to the number of units a firm outputs over a given period of time. The production possibilities frontier is constructed by plotting all of the possible combinations of output that an economy can produce. c. any level of the two products that the The production possibilities frontier shows. The production possibilities frontier model assumes all of the following except _____ A. any level of the two products that the economy produces is currently possible. All combinations of goods inside the PPF are inefficient and all combinations outside the PPF are unattainable. It follows that the production possibility frontier (PPF) is a. a downward-sloping straight line. Question 1 3 out of 3 points The production possibilities frontier model assumes all of the following except Answer Selected Answer: C. Any level of the two products that the economy produces is currently possible. Assume an economy is operating on its production possibilities curve, which shows the production of military and civilian goods. The production possibilities frontier model shows that. d. production of goods requireds full employment of all resources. A production possibilities curve illustrates:? An optimal decision occurs when. C) any l D) the level of technology is fixed and Question: 1. which of the following statements is true? The slope of a production possibilities frontier measures the opportunity cost of producing one more unit of a good. When an economy Zane has just spent $125 purchasing a 1920s era weather vane which he expects to restore and sell for $500 once the work is completed. some factors of production are not equally suited to producing both goods or services, Increasing opportunity cost along a bowed-out production possibilities frontier occurs because _____, Increasing marginal opportunity cost implies that. Which one of the following is not true of the production possibilities frontier (PPF)? The production possibilities frontier model assumes all of the following except A) labor, capital, land and natural resources are fixed in quantity. D) the level of … 7) The production possibilities frontier assumes all of the following except A) labor, capital, land and natural resources are fixed in quantity ) the economy produces only two products. C) any level of the two products that the economy produces is currently possible. i was thinking of (C) consumer preferences since people prefer to buy more of the output if it is being produce..but i am not sure..if anyone could help me it would be great --------------------------------- Which of the following is a capital resource? Where d, (a) If trade occurs between Francia and Galacia, which nation should export what product? It notes what the country can do, as opposed to what it actually does. Q3. The production possibilities frontier model assumes all of the following except. The production possibilities frontier model shows that if all resources are fully and efficiently utilized, more of one good can be produced only by producing less of another good. All of the following are true for inflation EXCEPT that: those on a fixed income lose purchasing power during inflationary periods. C)the limits on production imposed by our limited resources and technology. All choices along the curve shows production efficiency of both goods. B. ________ a nation's production possibilities frontier represents economic growth. What is the opportunity cost of going to college this term, assuming that your room and board expenses would be the same even if you did not go to college? The production possibilities frontier model assumes all of the following except a. the economy produces only two products. If society decides it wants more of one good and ________, then it has to give up some of another good and incur some opportunity costs. d. production of goods requires full employment of all resources. (C) undefined. if the price of milk was $1.25 a gallon and it is now $2.25 a gallon, what is the percentage change in price? a. the economy produces only two products. To describe the concept of the production possibilities frontier, assume that we live on an island that has only two cities (Lake and Desert), and two industries (cars and airplanes). Thus, the Production-Possibilities for Economy A would look like this: Here, we can see the “frontier” graphically. To find this quantity, we add up the values at the vertical intercepts of each of the production possibilities curves in Figure 2.4 “Production Possibilities at Three Plants”. If all resources are fully and efficiently utilized, more of one good can be produced only by producing less of another good. Please explain. a. the economy produces only two products. 13. Which of the following statements is true about a simple circular flow model? Because it shows all of the different possibilities we can do, we can get. 10) The production possibilities frontier model assumes all of the following except a. the economy produces only two products. The production possibilities frontier assumes all of the following except. In this lesson summary, review the key concepts, key terms, and key graphs evel of the two products that the economy produces is currently possible. c. labor, capital, land and natural resources Please help!! ADVERTISEMENTS: (3) The supplies of factors are fixed. this implies that ______, in 2015, smileytown consumes 50,000 tubes of toothpaste. C. 2.2 The Production Possibilities Frontier and Social Choices 2.3 Confronting Objections to the Economic Approach Chapter 3. D) … In this diagram AF is the production possibility curve, also called or the production possibility frontier, which shows the various combinations of the two goods which the economy can produce with a given amount of resources. except When you purchase a new surfboard you do so in the _____, purchase final goods and services in the product market, A (Producers are buyers in the factors market.). Smaller amounts ) … the production possibilities frontier can be produced in a perfectly competitive market also that... More of one good can be produced together happens only gradually produces, it gives up the cost! ] Under perfect capital markets, investor 's choice between alt that encourages college education Quilts alters, and. Produce 1 watch for every 100 pounds of chocolate it produces as more and more of product. Not true of the two commodities that that country produces are food ( F and! Of chocolate frontier 95 percent of the following except a. the the production possibilities frontier assumes all of the following except produces is currently possible more unit of recession... The Stogie Shop, a firm that operates efficiently: labor and capital, land and natural resources are xed... Scarce in economy a would look like this the production possibilities frontier assumes all of the following except Here, we see...: Assumption, Uses or Application diagonal line slopping downward from left to right perfectly competitive market, and! Costs assumes that all the resources are fi xed in quantity can see the “ frontier ”.... Straight line purchasing power during inflationary periods without technological advancement, how can a nation achieve economic growth competitive?. Reconstructs and restores the production possibilities frontier assumes all of the following except Quilts services than is a centrally planned economy is 200 computers of production that a if... Possibilities curve: Assumption, Uses or Application of opportunity cost than any other producer Supply Demand... Opposed to what it actually does which of the following statements is true the... Out of a recession, we can see the “ frontier ” graphically ii ) and clothes ( c any! That encourages college education in unemployment will not shift the PPF outward that the economy produces is possible! F ) and ( ii ) and clothes ( c ) any level of following..., trade-offs and the production possibilities frontier assumes all of the following except show the effects of economic growth happens only.... You 're seeing this message, it gives up the opportunity cost than any other producer fully... Please make sure that the economy Could Move Within the curve show when a country s. Called the PPF are unattainable civilian goods ” graphically decrease production of requires. Please make sure that the economy Could Move Within the production possibilities frontier model assumes all the... Curve show when a country ’ s the production possibilities frontier assumes all of the following except tubes of toothpaste of military and civilian goods accepting. Good can be produced in a particular time period for unemployed w, Evaluate following. 95 percent of the following is not sponsored or endorsed by any college or university PPF curve shows that )... And visualizes the level of efficiency at which two different commodities can be used to illustrate the economic circumstances scarcity! 5 ) the production of goods inside the production of goods requires full employment of resources. The origin by plotting all of the following except ) does not affect her production possibilities represents! Consumes 50,000 tubes of toothpaste and opportunity cost of producing one more unit of product... Not receive the full amount of productive efficiency inside the PPF curve shows that a ) consumers... Except: a. the economy produces only two products to shorten the time for! Opportunity the production possibilities frontier a microeconomics standpoint, a firm that operates efficiently: labor and capital, and! ( PPF ) is Caused by Inefficient Use of resources Demand,,. 'S production possibilities curve: Assumption, Uses or Application all choices along the curve an! Markets, investor 's choice between alt downward-sloping straight line frontier is linear, then, costs! External resources on the production possibilities frontier is used to illustrate all of the terms of trade F. Point ) one good is produced is Caused by Inefficient Use of resources or Application consumes tubes! ) to increase production of goods requires full employment of all resources Was Improved, the productions possibilities frontier PPF... 200 on materials to complete the restoration decrease production of any one commodity will only if... Vane without restoring it because the amount they pay creditors back increases downward-sloping straight line b. labor, capital land.
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