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Eco 231 final || Already Graded A+.
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  • Eco 231
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When a society cannot produce all the goods and services people wish to have, it is said that the economy is experiencing correct answers scarcity. In most societies, resources are allocated by correct answers the combined actions of millions of households and firms. The principle that "peopl...

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  • August 16, 2024
  • 23
  • 2024/2025
  • Exam (elaborations)
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  • when a society cannot produce all the goods and se

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Eco 231 final || Already Graded A+.
When a society cannot produce all the goods and services people wish to have, it is said that the
economy is experiencing correct answers scarcity.

In most societies, resources are allocated by correct answers the combined actions of millions of
households and firms.

The principle that "people face tradeoffs" applies to correct answers individuals, families,
societies

Economists use the word equality to describe a situation in which correct answers each member
of society has the same income.

Efficiency means that correct answers society is getting the maximum benefits from its scarce
resources.

When computing the opportunity cost of attending a concert you should include correct answers
the price you pay for the ticket and the value of your time.

Denise decides to spend three hours working overtime rather than watching a video with her
friends. She earns $10 an hour. Her opportunity cost of working is correct answers the enjoyment
she would have received had she watched the video.

Which of the following is not an example of the opportunity cost of going to school? correct
answers The money a student spends on rent for his apartment while attending school.

Making rational decisions "at the margin" means that people correct answers compare the
marginal costs and marginal benefits of each decision.

Bill is restoring a car and has already spent $4000 on the restoration. He expects to be able to sell
the car for $5800. Bill discovers that he needs to do an additional $2400 of work to make the car
worth $5800 to potential buyers. He could also sell the car now, without completing the
additional work, for $3800. What should he do? correct answers He should sell the car now for
$3800.

Economists are particularly adept at understanding that people respond to correct answers
incentives.

People are likely to respond to a policy change correct answers if the policy changes either the
costs or benefits of their behavior.

Which of the following statements about trade is false? correct answers With trade, one country
wins and one country loses.

,Suppose that a country that has a high average wage level agrees to trade with a country that has
a low average wage level. Which country can benefit? correct answers both

The term market failure refers to correct answers a situation in which the market on its own fails
to allocate resources efficiently

Which two groups of decision makers are included in the simple circular-flow diagram? correct
answers households and firms

Which of these terms are used interchangeably? correct answers "inputs" and "factors of
production"

In economics, capital refers to correct answers buildings and machines used in the production
process.

In the markets for the factors of production in the circular-flow diagram, correct answers
households are sellers and firms are buyers.

The production possibilities frontier is a graph that shows the various combinations of output that
an economy correct answers can produce

Which of the following is a correct statement about production possibilities frontiers? correct
answers An economy can produce at any point on or inside the production possibilities frontier,
but not outside the frontier.

Production is efficient if the economy is producing at a point correct answers on the production
possibilities frontier.

Suppose a nation is currently producing at a point inside its production possibilities frontier. We
know that correct answers the nation is not using all available resources or is using inferior
technology or both.

The production possibilities frontier provides an illustration of the principle that correct answers
people face trade-offs.

The opportunity cost of obtaining more of one good is shown on the production possibilities
frontier as the correct answers amount of the other good that must be given up.

The following table contains some production possibilities for an economy for a given year:

cakes rolls(in dozens)
100 5000
120 4600
140 ?

If the production possibilities frontier is bowed outward, then "?" could be correct answers 4100

, A production possibilities frontier can shift outward if correct answers there is a technological
improvement.

The production possibilities frontier is used to illustrate some basic economic ideas, including
correct answers scarcity, opportunity cost, economic growth

Books Magazines
400 0
300 200
200 350
100 450
0 500

What is the opportunity cost to Libraryland of increasing the production of books from 200 to
300? correct answers 150 magazines

Books Magazines
400 0
300 200
200 350
100 450
0 500

Which of the following statements is correct?

The opportunity cost of an additional 100 books is constant at 50 magazines.

The opportunity cost of an additional 100 books is constant at 100 magazines.

Libraryland's production possibilities frontier is a straight, downward-sloping line.

The opportunity cost of an additional 100 books increases as more books are produced. correct
answers The opportunity cost of an additional 100 books increases as more books are produced.

Suppose Susan can wash three windows per hour or she can iron six shirts per hour. Paul can
wash two windows per hour or he can iron five shirts per hour. correct answers Susan has an
absolute advantage over Paul in washing windows.

Susan has a comparative advantage over Paul in washing windows.

Paul has a comparative advantage over Susan in ironing shirts.

Suppose Jim and Tom can both produce baseball bats. If Jim's opportunity cost of producing
baseball bats is lower than Tom's opportunity cost of producing baseball bats, then correct
answers Jim has a comparative advantage in the production of baseball bats.

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