Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point D to Point B, the opportunity cost of hybrid cars, measured in terms of motorcycles,
A. initially increases, then decreases.
B. increases.
C. remains constant.
D. decreases.
Answer: B
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Equilibrium GDP occurs when total spending equals total output.
Answer the following statement true (T) or false (F)
Which of the following describes a differentiated product?
a. A product that consumers perceive as distinctive in some way b. A product that lacks many competitors in a market or industry c. A product that is produced and sold in a niche market d. A product that is produced by a natural monopolist
Money is
a. valuable because it is backed by gold. b. whatever is generally accepted in exchange for goods and services. c. anything that is a liability of a commercial bank d. an object to be consumed.
When a country allows trade and becomes an importer of a good,
a. consumer surplus and producer surplus both increase. b. consumer surplus and producer surplus both decrease. c. consumer surplus increases and producer surplus decreases. d. consumer surplus decreases and producer surplus increases.