PPF
How many Allocatively efficient points can there be on the PPF?
There is only one unique point on the PPF that is allocatively efficient
True or False. A country has a comparative advantage in producing a good when they can produce the good at a lower absolute cost.
False
Study of the large economy as a whole or in its basic subdivisions (National Economic Growth, Government Spending, Inflation, Unemployment.
Macroeconomics
If the price of Frosted Flakes has increased, what would happen for the demand curve of Frosted Flakes?
The demand curve would not shift
True or False. The PPF shows all the combinations of two goods that a country should produce given their currently available resources.
False. The PPF only shows the combinations of two goods that a country could possibly produce given their currently available resources.
A country can have an absolute advantage in producing both goods. Is this statement True or False?
True
Investors ought to be more socially responsible and stop investing in vice stocks. Is this a positive or normative statement?
Normative Statement
True or False? The law of demand claims that when the price of a good falls the quantity demanded for that will good fall.
False. When the price of the good falls the quantity demanded for that good rises.
The two goods on the PPF are Planes and Computers computer. A new innovation in computer manufacturing has made it easier for computers to be produced. Would the PPF grow or shrink?
The PPF would expand but only for Apples. This is called Biased growth.
Using table #1. Which country has the comparative advantage in producing phones?
United Kingdom
The desired rate of return on gambling stocks are higher compared to others. Is this a positive or normative statement?
Positive Statement
If the price of chicken increases, demand for beef will?
Demand for Beef would increase because chicken and beef are substitutes
A PPF that has a shape of a straight-line has a..........opportunity cost.
Constant opportunity cost
Using table #2. Which country has the comparative advantage in producing cars?
US
Is the highest valued alternative that you give up as a result of a decision.
Opportunity Cost
Demand for fast food in Nacogdoches will ___________ as the number of students living in town increases
Increase
The country of Sweden has a high unemployment rate and its factories are idle. Where is Sweden on the PPF?
A. Inside the PPF
B. On the PPF
C. Outside of the PPF
A. Inside the PPF
Assume that the only two goods Brazil and Japan produce are planes and radios. Japan has a comparative advantage in radios and Brazil has an absolute advantage in producing planes. Which country would import radios?
Brazil would import radios because they do not have a comparative advantage in producing them.
What kind of people make decisions by evaluating costs and benefits of marginal changes, incremental adjustments to an existing plan?
Rational people
Rational people think at the margin
Demand for goods/services such as new cars and airline travel are likely to _________ when income goes up, while demand for things like used cars and bus travel are likely to __________ when income goes down
Increase, Increase