ECON 2010 quiz 2

the term opportunity costs suggests that

because goods are scarce, in order to get some good you must give up some other good in return.

Specialization of labor

can create problems of boredom and repetitive motion injuries.

A country has an absolute advantage in the production of a good if that country

can produce the good using fewer resources than another country would require.

Money facilitates trade because

it serves as a medium of exchange.

Which of the following is a characteristic of a pure command economy?

Centralized economic planning is used to answer the basic economic questions.

A production possibilities frontier will shift inward if there is more unemployment of labor

False

if jason can wash a car in 20 minutes and wash a dog in 10 minutes, and megan can wash a car in 15 minutes and a dog in 15 minutes:

Jason has both a comparative and an absolute advantage in washing a dog.

Which economic question does the decision to produce butter instead of guns answer?

What to produce?

Which of the following would shift the production possibilities frontier outward?

an improvement in technology.

The opportunity cost of an activity

depends on the individual's subjective values and opinions.

Adam Smith's term, "the invisible hand," refers to,

market forces.

A production possibilities frontier will be bowed out if

resources are not perfectly adaptable to making each good.

If all resources are used efficiently to produce goods and services, a nation will find itself prudcint

somewhere on its production possibilities frontier.

If helen gives up the opportunity to bake 40 cakes for each room she paints and Josh can paint one room in the time it takes him to bake 60 cakes,

the opportunity cost of baking cakes is lower for Josh.