Macro Econ 2101- CHPT 2 Quiz

A worker is hired in a

factor market

Firms

sell goods in the product market

increasing opportunity cost along a bowed-out production possibilities frontier occurs because

some factors of production are not equally suited to producing both goods or services

Comparative advantage means

the ability to produce a good or service at a lower opportunity cost than any other producer

Which of the following is a factor of production?

the janitor a the local elementary school

The production possibilities frontier shows

the maximum attainable combinations of two products that may be produced in a particular time period with available resources

Increasing marginal opportunity cost implies that

the more resources already devoted to any activity, the pay off from allocating yet more resources to that opportunity increases by progressively smaller amounts

Without technological advancement, how can a nation achieve economic growth?

through an increase in supplies of factors of production

The table above shows the output per day of two gardeners, George and Jack. They can either devote their time to mowing lawns of cultivating gardens. Lawns Mowed- G=10 J=6 Gardens Cultivated- G=5 J=4

two lawns mowed

Suppose your expenses for this term are as​ follows: tuition:​ $9,000, room and​ board: $1,500, books and other educational​ supplies: $1,000.​ Further, during the​ term, you can only work part−time and earn​ $3,000 instead of your full−time salary of​ $8,000. What is the opportunity cost of going to college this​ term, assuming that your room and board expenses would be the same even if you did not go to​ college?

$15,000

The figure above shows the production possibilities frontiers for Costa Rica and Guatemala. Each country produces two​ goods, pineapples and coconuts. What is the opportunity cost of producing 1 ton of coconuts in​ Guatemala?

1/2 of a ton of pineapples

If the economy is currently producing at point A, what is the opportunity cost of moving to point B?

12 thousand forks

The figure to the right shows the production possibilities frontier for Vidalia, a nation that produces two goods, roses and orchids. What is the opportunity cost of one dozen orchids?

2.5 dozen roses

If the economy is currently producing at point X, what is the opportunity cost of moving to point W?

3 million tons of paper

If society decides it wants more of one good and ____, then it has to give up some of another good and incur some opportunity costs.

All resources are fully utilized

____ a nation's production possibilities frontier represents economic growth.

An outward shift of

The table above shows the output per day of two gardeners, George and Jack. They can either devote their time to mowing lawns or cultivating gardens. Which of the following statements is true? Lawns Mowed- G=10 J=6 Gardens Cultivated- G=5 J=4

George has an absolute advantage in both tasks

The table above shows the output per day of two gardeners, George and Jack. They can either devote their time to mowing lawns or cultivating gardens. Which of the following statements is true? Lawns mowed- G=10 J=6 Gardens cultivated- G=5 J=4

Jack has a comparative advantage in garden cultivating and George in lawn mowing

____ is (are) inefficient in that not all resources are being used.

Point A

____ is (are) unattainable with current resources.

Point C

Which of the following statements is true about a simple circular flow model?

Producers are buyers in the factors market

For each watch that Switzerland​ produces, it gives up the opportunity to make 50 pounds of chocolate. Germany can produce 1 watch for every 100 pounds of chocolate it produces. Which of the following is true about the comparative advantage between the two​ countries?

Switzerland has the comparative advantage in watches

The production possibilities frontier assumes all of the following except

any level of the two products that the economy produces is currently possible

The​ ________ production points on a production possibilities frontier are the points along and inside the production possibilities frontier.

attainable

A production possibilities frontier with a ____ shape indicated increasing opportunity costs as more and more of one good is produced.

bowed outward

The table above shows the output per day of two gardeners, George and Jack. They can either devote their time to mowing lawns or cultivating gardens. What is Jack's opportunity cost of cultivating a garden? Lawns mowed- G=10 J=6 Gardens cultivated- G=5 J=4

one and a half lawns mowed

The concept of ____ is that the economic cost of using a factor production is the alternative use of that factor is given up.

opportunity cost

If the production possibilities frontier is linear, then

opportunity costs are constant as more of one good is produced

When you purchase a new surfboard you do so in the

product market

Households

purchase final goods and services in the product market