What is the reason for the law of increasing opportunity costs?
a. There is no reason: it is just one of the laws of economics.b. Resources have varying abilities and those with lower opportunity costs of producing a good will be used to produce it before resources with higher opportunity costs produce it.
c. The price of a good rises as more of it is demanded.
d. As more of a good is produced, the taxes applied to the production of the good rise.
e. c and d
ANS: B
Production Possibilities Frontier Framework
- Refer to Exhibit 2-9. For Adam, the opportunity cost of producing one unit of good A is __ unit(s) of good B.
- Refer to Exhibit 2-9. For Adam, the opportunity cost of producing one unit of good B is __ unit(s) of good A.
- Refer to Exhibit 2-9. For Alex, the opportunity cost of producing one unit of good B is __ unit(s) of good A.
- Refer to Exhibit 2-9. For Alex, the opportunity cost of producing one unit of good A is __ unit(s) of good B.
- Refer to Exhibit 2-9. If Alex and Adam each specialize in the good in which he has a comparative advantage and then engage in trade, ____ can consume a combination of goods that lies beyond his PPF.
- Refer to Exhibit 2-9. Who has the comparative advantage in the production of good B?
- Refer to Exhibit 2-9. Who has the comparative advantage in the production of good A?
- Refer to Exhibit 2-8. For Maria, the opportunity cost of producing one unit of good Y is ___________ unit(s) of good X.
- Refer to Exhibit 2-8. For Maya, the opportunity cost of producing one unit of good Y is ___________ unit(s) of good X.
- Refer to Exhibit 2-8. For Maria, the opportunity cost of producing one unit of good X is ___________ unit(s) of good Y.
- Refer to Exhibit 2-8. For Maya, the opportunity cost of producing one unit of good X is ___ unit(s) of good Y.
- Refer to Exhibit 2-8. If Maria and Maya each specialize in the good in which she has a comparative advantage and then engage in trade, _______ can consume a combination of goods that lies beyond her PPF.
- Refer to Exhibit 2-8. Who has the comparative advantage in the production of good Y?
- Refer to Exhibit 2-8. Who has the comparative advantage in the production of good X?
- The PPF between goods X and Y will be a downward-sloping
- Suppose Andrea is taking just two courses and is at a point inside her PPF of grades for those two courses. If Andrea changes her work habits then it is impossible for
- Suppose Andrea is taking just two courses and is at a point on her PPF of grades for those two courses. Now this PPF shifts inward and Andrea moves to a point on the new PPF. Then it is impossible for
- Between 1910 and today, the number of farmers in the United States __ dramatically as a result of ___ in farming in the twentieth century.
- A person has a comparative advantage in the production of a good when they can produce the product at a(n) ________ opportunity cost compared to another person.
- Michael can produce the following combinations of X and Y: 10X and 10Y, 5X and 15Y, and 0X and 20Y. Vernon can produce the following combinations of X and Y: 100X and 20Y, 50X and 30Y, or 0X and 40Y. It follows that
- Keisha can produce the following combinations of X and Y: 100X and 20Y, 50X and 30Y, or 0X and 40Y. The opportunity cost of one unit of Y for Keisha is
- Carlos can produce the following combinations of X and Y: 10X and 10Y, 5X and 15Y, and 0X and 20Y. The opportunity cost of one unit of X for Carlos is
- If Sean can bake bread at a lower opportunity cost than Jason, and Jason can produce paintings at a lower opportunity cost than Sean, it follows that
- Country 1 produces two goods, A and B. Country 2 produces the same two goods. Currently, country 1 produces 100A and 200B and country 2 produces 300A and 700B. Which of the following statements is true?
- Country X has a high unemployment rate. It follows that country X is operating