A production possibilities curve is negatively sloped because:
a. unemployment increases as an economy moves down along the curve
b. along the curve, production of one good must be sacrificed in order to increase production of another.
c. unemployment decreases as an economy moves down along the curve.
d. as the price falls, more goods are purchased.
b
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In a competitive market economy, a resource in short supply will be allocated
A. so that each firm gets enough to keep producing some portion of its output. B. according to how much each firm purchased before the shortage. C. to those firms that can make the most profitable use of it. D. by government fiat.
According to the neoclassical theory of distribution, the wages paid to John Deere tractor assembly line workers are higher than those paid to fast food workers because assembly line workers
a. have college degrees, on average, whereas fast food workers usually do not. b. produce a product of greater market value than do fast food workers. c. work in a less stressful environment than do fast food workers. d. are less likely to belong to a labor union than are fast food workers.
Which of the following is an example of signaling?
a. Pat is considering the purchase of a used car. Before making the purchase he has the car checked by an auto mechanic. b. Zach is applying for a new life insurance policy. Before writing the policy, the insurance company requires Zach to be examined by a doctor. c. Denise is applying for a new job. Before hiring her, the firm requires Denise to take a drug test. d. Marcus is planning to ask for Chaquila's hand in marriage. Before asking her, he buys her a box of her favorite chocolates and takes her to dinner at her favorite restaurant.
Which of the following is not an example of economic regulation?
a. Preventing a firm from starting up in a town. b. Maintaining a minimum price for a good. c. Restricting the use of hazardous materials without proper protection. d. Requiring a minimum amount of goods produced in a given year.