Econ 2302

A straight, downward-sloping line

A production possibilities Frontier that illustrates a 1-for-1 trade off between goods is drawn as...

Resource Market

According to the circular flow diagram, when a household receives a wage for supplying a firm with labor, the interaction occurs in the...

MB exceeds MC

An economy should continue producing a good or service so long as:

Decreases

As the amount of an activity increases, its marginal benefit:

Specialize in the production of the good for which they wield a comparative advantage.

Because of differences in opportunity costs, individuals and businesses

The marginal benefit of eating ice cream is falling

Evaluate the following statement: "I love ice cream. But I've eaten so much ice cream today, I can't possibly eat another cup" quizlet

Resources

If you decide to produce at a level where marginal cost exceeds marginal benefits (MC>MB), there is a waste of _______________ that could be better used somewhere else.

Varies

Individuals and countries specialize because the opportunity cost of producing goods and services:

Inefficiently

On a production possibilities frontier, if you are able to increase the production of both Goods at the same time, then, initially, resources were allocated...

Increasing, Opportunity

The law of __________ opportunity cost says that because some resources are better suited to producing one good or service than another, as the production of a good or a service increases, the _________ cost of each additional unit rises.

Opportunity

The producer with the lowest relative ____________ cost has a comparative advantage and should specialize in the production of that good

Allocating Resources

because the world is characterized by scarcity, people must choose between different uses for the resources at their disposal. In economics, we refer to this as: