Production Possibility Curve
The next best alternative use for a resource.
What is opportunity cost?
The term for when a country or individual can produce the largest quantity of goods or services with the same amount of resources.
What is absolute advantage?
The term for when a country allocates a majority or all of its resources towards producing a certain good or service.
What is specialization?
The idea that there is an opportunity cost for every decision made (hint: it relates to lunch).
The "place" from which households purchase goods and services.
The shape of the PPC when the opportunity cost is constant.
The term for when a country or individual can produce a good or service at a lower opportunity cost compared to another country or individual.
What is comparative advantage?
If Kandi can make 5 apples or 25 smartphones, calculate the opportunity cost for producing apples in terms of smartphones.
What is 1 apple for 5 smartphones?
The numerical range generally accepted as "full employment" in our economy.
What is 4 to 6%?
Components that households sell to the factor market.
What are factors of production (land, labor, capital, entrepreneurship)?
Where a point is located on the PPC when the economy is efficiently using resources at full appointment.
What is on the curve?
For every bracelet Bobby makes, the opportunity cost for doing so is six pickles. But Penny forgoes three pickles for every bracelet she produces. Name who has the comparative advantage in making bracelets.
Who is Pennny?
If Kandi can make 4 apples or 24 smartphones, calculate the opportunity cost for producing apples in terms of smartphones.
What is 1 apple for every 6 smartphones?
A collection of economic units treated as though they are one unit.
True or false, the amount of money/resources flowing into one component of the model is equal to the amount flowing out.
This is the term for the shape of the PPC when there is an increasing opportunity cost.
What is bowed out?
In three hours, Bobby can make 10 pencils while Penny can make 15 pencils. Name who has the absolute advantage in making pencils.
Who is Penny?
Answer the 200 and 300 point questions in this category first. Given the two individuals, who has the comparative advantage in producing apples?
Who is Kandi?
The four types of resources.
What are land, labor, capital, and entrepreneurship?
Components of income that households receive for their inputs to the factor market.
What are wages, rents, interest, and profits?
Things that cause the PPC to shift outwards (list two).
What is new technology, increased productivity, or larger labor force?
If Bobby has a comparative advantage in making jam but Penny has a comparative advantage in producing glitter, who benefits if they trade?
Who are Bobby AND Penny (both)?
Answer the 400 point question in this category first. What would be ideal terms of trade that would benefit both countries (how many smartphones for every apple).
What is 1 apple for every 5.5 smartphones?
The study of how individuals and firms deal with security.
What is microeconomics?
The components of the circular flow can be used to calculate this economic quantity.
What is gross domestic product?