If opportunity costs are constant, then the production possibilities frontier a.

Question

If opportunity costs are constant, then the production possibilities frontier



a. will be a straight line and have a negative slope.

b. will be flat and horizontal.

c. will be positively sloped.

d. will be bowed out and have a negative slope.

The fact that resources are not equally productive in all activities implies that



a. a production possibilities frontier will be bowed outward.

b. a production possibilities frontier will be bowed inward.

c. gains from specialization and trade are unlikely.

d. the production possibilities frontier will be a straight line.

A factory has 10 workers. Each worker can produce a maximum of either 2 units of bicycles or 5 units of tricycles a week. One day, the firm decides it would like to produce 16 units of bicycles and 5 units of tricycles. This output level is



a. efficient.

b. unattainable.

c. inefficient.

d. efficient but unattainable.

Production efficiency is achieved when



a. a society is able to produce goods and services at the lowest possible cost.

b. the production possibilities frontier shifts inward at an even pace.

c. resources are equally productive in all activities.

d. there are no more tradeoffs.

A technological improvement is represented by



a. a point inside the PPF.

b. a point outside the PPF.

c. a rightward shift of the PPF.

d. a movement up along the PPF.

Explanation / Answer

a. will be a straight line and have a negative slope.

a. a production possibilities frontier will be bowed outward.

c. inefficient.

a. a society is able to produce goods and services at the lowest possible cost.

c. a rightward shift of the PPF.

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