opportunity cost & PPC

Which of the following statements best captures the tradeoff between capital goods and consumption goods in economic growth?

A society must balance the need for current consumption with the ability to consume more in the future.

Which of the following would NOT be part of the opportunity costs of going to college?

Money spent on clothes.

Which of the following concepts can be modeled using a PPC?

When all resources are being used, making more of one good means making less of the other good.

Which of the following statements about the economic growth in this PPC are true?

Xam now has more resources or technology available to produce more fast cars, but not fruit smoothies.

Which of the following movements would represent economic growth?

Z to V

Which of the following is an accurate representation of economic growth?

An increase in both the potential and actual level of output of goods and services over time.

How does the opportunity cost of Good R change as output of S increases?

It decreases.

What does the shape of the PPC say about the production of these two goods?

Goods L and M require very different resources to produce.

What does the shape of this PPC indicate about how opportunity cost changes as more of one good is produced?

Increasing opportunity cost.

Which of the following best explains why this PPC is bowed outward from the origin?

The resources used to produce scooters and ice cream are not interchangeable.

What statement explains why the PPC for ice cream and frozen yogurt is a straight line instead of a curve?

The shape of the PPC signifies that the resources needed to produce the two goods are interchangeable.

Opportunity cost is best described by which of the following statements?

The value of the next best option given up when making a decision.

Based on Alex's PPC, which of the following statements best describes what we can say about how he should split his time?

We cannot tell how he should split his time.