Quiz b

1. / The graphical device which illustrates the concept of scarce resources being efficiently utilized in the economy is
A. / a budget line.
B. / a time-series graph.
C. / a production possibilities frontier.
D. / a consumption possibilities line.
2. / Which of the points in the graph are efficient?
A. / C and F only
B. / C, D and F only
C. / A, C, D, F, and G only
D. / A, C, F, and G only
3. / The opportunity cost of more capital goods today is
A. / fewer capital goods in the future.
B. / fewer consumer goods in the future.
C. / fewer consumer goods today.
D. / more unemployed resources in the future.
4. / Which of the following would NOT allow society to move to point h in the figure?
A. / an improvement in technology
B. / more efficient use of current resources
C. / an increase in quantity of labor
D. / an increase in quantity of capital
5. / If all resources are equally productive in producing all goods, the production possibilities curve will be
A. / convex to the origin.
B. / concave to the origin.
C. / linear.
D. / expanding over time.
6. / The shape of the production possibilities curve in the figure indicates that
A. / production of corn is characterized by increasing costs while the production of cloth is characterized by decreasing costs.
B. / production of both corn and cloth is characterized by increasing costs.
C. / production of both corn and cloth is characterized by constant costs.
D. / production of corn is characterized by constant costs and the production of cloth is characterized by increasing costs.
7. / Suppose an acre of land yields 100 bushels of corn and that one bushel of corn provides enough seed for one-quarter of an acre of land. The opportunity cost of consuming another bushel of corn today is
A. / 100 bushels of corn next year.
B. / 25 bushels of corn next year.
C. / 10 bushels of corn next year.
D. / 2.5 bushels of corn next year.
8. / If a country's production possibilities curve gets more bowed out over time, it is an indication that
A. / technological change has taken place.
B. / society is learning to use its resources more efficiently.
C. / the quantity of labor and capital have increased.
D. / resources have become more highly specialized.
9. / In the figure, how many units of corn are produced at point a?
A. / 2000
B. / 2500
C. / 3000
D. / We can't tell without more information.
10. / The production possibilities frontier illustrates
A. / the fundamental concept of scarcity.
B. / the opportunity cost of acquiring more of one good.
C. / an economy's maximum output utilizing all resources efficiently.
D. / All of the above are correct.
11. / Any point outside the boundary of a production possibilities frontier is
A. / efficient.
B. / inefficient.
C. / unattainable.
D. / attainable.
12. / Which of the following statements is FALSE?
A. / As society increases its wealth, the problem of scarcity disappears.
B. / The factors of production are used to produce outputs that help society satisfy its wants.
C. / Even though a society faces the problem of scarcity, it does not necessarily suffer from poverty.
D. / Land and labor are both factors of production.
13. / The law of increasing costs is due to
A. / taxes.
B. / scarcity.
C. / the fact that it is more difficult to use resources efficiently the more society produces.
D. / the fact that resources are not perfectly adaptable for alternative uses.
14. / Resources are also known as
A. / factories.
B. / minerals.
C. / stocks, bonds, and other financial instruments.
D. / factors of production.
15. / The opportunity cost for this economy to move from point B to point A is
A. / 15 bushels of wheat.
B. / 90 bushels of wheat.
C. / 75 pounds of beef.
D. / 25 pounds of beef.
16. / In one day, Joe can produce 24 bushels of wheat (W) or 8 pounds of rice (R). Joe's opportunity cost of 1 bushel of wheat is
A. / 1/3 pound of rice.
B. / 3 pounds of rice.
C. / 1/8 pound of rice.
D. / 8 pounds of rice.
17. / Moving from one point to another along a given production possibilities frontier, producing more of one good requires that
A. / less of the other good be produced.
B. / the production of the other good be held constant.
C. / more of the other good be produced.
D. / a better technology be employed.
18. / The economy pictured produces only wheat and beef. If the economy is producing 60 bushels of wheat and 50 pounds of beef, they are producing at a point that is
A. / attainable, but inefficient.
B. / unattainable, given its resources.
C. / producing too much wheat.
D. / producing too much beef.
19. / The point at which a PPF intersects the X axis is
A. / unattainable.
B. / attainable but inefficient.
C. / attainable and efficient.
D. / unattainable and inefficient.
20. / Assume this economy produces wheat in the fertile middle of the country and produces rice in the southern wetlands. What could explain th eshcnge in the country's PPF from PPF1 to PPF2?
A. / a drought in the southern wetlands
B. / a drought in the middle part of the country
C. / development of improved varieties of rice
D. / development of improved varieties of wheat