Economics 2a quiz

Efficiency is illustrated by

the production possibilities frontier only.

An economic outcome is said to be efficient if the economy is

getting all it can get from the scarce resources it has available.

Factors of production are

inputs into the production process.

An economy's production of two goods is efficient if

it is impossible to produce more of one good without producing less of the other.

A production possibilities frontier shifts outward when

the economy experiences economic growth.

According to the circular-flow diagram, if Denny is the owner of a landscaping business and he just received $50 for mowing Mrs. Pendleton's lawn,

Denny acts as a firm who interacted in the markets for goods and services with Mrs. Pendleton.

Which of the following events would explain the shift of the production possibilities frontier from A to B? (upward shift)

The economy experienced a technological advance in the production of books. (books vs. DVDs)

Which of the following would most likely have caused the production possibilities frontier to shift outward from A to B?

a general technological advance

A circular-flow diagram is a model that

a.) helps to explain how participants in the economy interact with one another. b.) helps to explain how the economy is organized.

A circular-flow model and production possibilities frontier are similar in that

both make use of assumptions.

A model that shows how dollars flow through markets among households and firms is called the

circular-flow diagram.

Any point on a country's production possibilities frontier represents a combination of two goods that an economy

can produce using all available resources and technology.

The shift of the production possibilities frontier from A to B can best be described as (outward shift)

economic growth.

A production possibilities frontier can shift outward if

there is a technological improvement.

Factors of production are

used to produce goods and services.