(1) A shift in the production possibilities frontier curve will occur as a resul
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Question
(1) A shift in the production possibilities frontier curve will occur as a result of all of the following except
a change in the endowment of resources.
a change in technology.
a change in the production of one good relative to another good.
a change in land, labor, or capital.
(2) A choice to produce more of one good and less of another results in
a movement along the PPF curve.
a shift in the PPF curve.
expansion of the economy.
none of the above.
(3) A shift in the demand curve is caused by
a change in price.
a change in quantity demanded.
an exogenous variable.
an endogenous variable.
(4) Exogenous variables on a demand curve are
changes in consumer income.
changes in the price of other goods.
changes in consumer expectations.
all of the above.
(5) Given the equation for a linear function, a + bx = y, which term represents the intercept?
b
x
bx
a
(6) If there is an agricultural economy in which land can be used either as pasture for cattle or as crop land for wheat, the opportunity cost of converting one acre from pasture to wheat production is the
profits from the extra wheat production.
the pounds of beef that are lost.
the number of bushels of wheat produced on an acre.
the total number of pounds of beef produced.
(7) For country A to have a comparative advantage in the production of agricultural products means that, relative to country B, with the same resources,
country A is better at producing agricultural products than industrial products.
country A is better at producing both agricultural products and industrial products.
country A can produce fewer industrial products than country B.
country A can produce more agricultural products than country B can produce.
(8) Suppose Canada produces only beer and oil. One unit of labor can produce, in a one hour period, either 100 barrels of beer or 10 barrels of oil. Examine the PPF for Canada. What is Canada’s opportunity cost for one barrel of beer?
10 barrels of oil
1/10 of a barrel of oil
1 labor hour
100 barrels of beer
(9) Each coordinate of a graph is written as
the vertical axis y and the horizontal axis x (y, x).
the horizontal axis x and the vertical axis y (x, y).
a point not representing an axis.
the horizontal axis x and the vertical axis y (y, x).
(10) A scatter plot is
information arrayed in a two-dimensional space to represent two variables for each data point.
a line graph that connects coordinates of a graph.
information arrayed in a two-dimensional space to represent three variables for each data point.
used when drawing a bar graph.
(11) If two variables, consumption (C) and income (I), are directly related we can say that
a change in income will not change consumption.
if income increases, then consumption increases.
if income increases, then consumption will change, but it is impossible to say in which direction it will change.
if income increases, then consumption will decrease.
(12) Rational choice
requires the undertaking of cost-benefits analysis.
is impossible under conditions of scarcity.
is defined as self-interested decision making.
both a and c.
(13) If everyone made rational choices,
everyone would make identical choices.
there would be no tradeoffs in any choice.
resources would exceed material wants.
individuals would still differ in their choices.
(14) Which of the following resources is scarce?
Air
Clean air
Garbage
Seawater
(15) Referring to the table below, what is the opportunity cost of tea in term of coffee?
coffee tea
200 0
160 40
120 80
80 120
40 160
0 200
200 pounds of coffee
40 pounds of coffee
160 pounds of coffee
1 pound of coffee
(16) Referring to the table below, what is the opportunity costs of Good B, as the production of Good B increases from 0 units to 2 units?
Good A Good B
9 0
8 2
6 3
3 4
3 less units of Good A
1 less unit of Good A
2 more units of Good B
There are no opportunity costs associated with the increase in production of Good B.
(17) The production possibilities frontier is a straight line when
the opportunity cost is zero.
the opportunity cost is constant.
the opportunity cost is increasing.
the opportunity cost is decreasing.
(18) To calculate the slope of the total product curve,
take the change in y divided by the change in x.
find the slope of a line tangent to the TP curve.
subtract the change in y from the change in x.
subtract the change in x from the change in y.
(19) Which of the following statements regarding the tangent line is false?
the tangent line just touches total production curve.
the slope of the tangent line is equal to the slope of the TP curve at a specific point.
the tangent line is used to find the slope of the TP curve.
the tangent line cannot be used to find the slope of the TP curve.
(20) Economists prefer elasticities for all of the following reasons except that
they do not depend on units of measurement.
they are based on total changes in units.
they are based on percentage changes.
they depict a relationship independent of how the variables are measured.
(21) The slope of a downward-sloping straight line is calculated as
the distance from the vertical intercept of the line to the origin divided by the distance from the origin to the horizontal intercept of the line.
the distance from the horizontal intercept of the line to the origin divided by the distance from the origin to the vertical intercept of the line.
the distance from the vertical intercept of the line to the origin times the distance from the origin to the horizontal intercept of the line.
the distance from the vertical intercept of the line to the origin minus the distance from the origin to the horizontal intercept of the line.
(22) The economic term “specialization” refers to the behavior of trading partners when each partner
produces goods, the resources for which are scarce.
produces only those goods for which it has a comparative advantage produces only those goods for which it has an absolute advantage
produces goods, the resources for which are abundant.
(23) Suppose a person can produce either two bushels of wheat per hour or six bushels of corn per hour. This person’s opportunity cost of one bushel of wheat is
three bushels of corn.
one-third of a bushel of corn.
two bushels of corn.
six bushels of corn.
(24) From the graphs below, who has a comparative advantage in mopping, Nick or Carl?
Carl
Nick
Cannot be determined from the given information
(25) The slope of a demand curve describes consumer behavior by showing
that the consumer increases his/her consumption of a good when the price goes down.
that suppliers provide more of the good as the price goes up.
that the consumer increases his/her quantity demanded as the price goes up.
that consumers do not care about price.
(26) An isoquant map shows
two variables represented by each axis.
one variable.
various values for a third variable.
different variables represented by each isoquant.
(27) A country that has an absolute advantage in a good
should restrict imports of that good.
can produce the good at a lower opportunity cost than its trading partner.
should specialize in the production of that good.
can produce the good using fewer resources than its trading partner.
(28) Russia can produce a bushel of corn with four workers and a bushel of rice with three workers. China can produce a bushel of corn with three workers and a bushel of rice with two workers. The opportunity cost for Russia to produce one bushel of corn is
one bushel of rice.
two bushels of rice.
one and one-third bushels of rice.
four bushels of rice.
(29) In weighing costs against benefits in any economic trade, the total cost can be viewed as
the opportunity cost.
the total economic value.
all explicit costs.
irrelevant to the trade.
(30) Economic value is defined as
the difference between the benefits and costs of an activity.
the cost of an economic activity.
the opportunity cost of work.
the benefit of an economic activity.
Explanation / Answer
(1) Option (3)
A change in production of one good relative to other causes a movement along PPF, not a shift.
(2) Option (1)
A change in production of one good relative to other causes a movement along PPF.
(3) Option (3)
Change in an exogenous variable (a non-price determinant of demand) will cause a shift of demand curve.
(4) Option (4)
Any non-price determinant of demand is an exogenous variable, e.g. consumer income, price of related goods or expectations.
NOTE: As per Chegg Answering Policy, first 4 questions are answered.
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