Exhibit 2-1 Production possibilities curve data
ConsumptionGoods
CapitalGoods
10
0
9
1
7
2
4
3
0
4
In Exhibit 2-1, according to the information, the opportunity cost of producing 3 units of capital is:
A. 3 units of consumption goods.
B. 4 units of consumption goods.
C. 6 units of consumption goods.
D. 7 units of consumption goods.
Answer: A
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A. total income minus taxes. B. what consumers base their buying decisions on. C. the amount consumers have to spend on goods and services. D. income before tax.
The one category of goods that are not sold but are, nevertheless, included in GDP is
a. inventories. b. imports. c. consumer services. d. exports.
The Lorenz curve shows the percentage of total income received by a given percentage of recipients whose incomes are arrayed from largest to smallest
Indicate whether the statement is true or false
Which event is most likely to increase the elasticity of demand for a good?
A) A decrease in the demand for the good B) A decrease in the price of the good C) An increase in the demand for the good D) Higher incomes for consumers of the good E) The appearance on the market of excellent substitutes for the good