If the United States, at the point where it is currently producing, must give up the production of 500 bicycles (B) to produce 20 additional tractors (T) with the same resources, its opportunity cost may be expressed as:
A) 1/25B = 1T.
B) 1B=1T.
C) 1B=25T.
D) 25B=1T.
Ans: D) 25B=1T.
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In this economic growth and production possibilities curve, operating under the new production possibilities curve will always produce more than the old one, provided that the ______.
a. economy in the new curve is inefficient
b. economy for both curves is efficient
c. same technology is used in the economy of both curves
d. economy in the new curve uses fewer resources
Which of the following government actions will decrease surplus food supplies?
A. A decrease in import restrictions. B. An increase in the loan rate. C. A decrease in acreage set-asides. D. Subsidized advertising of U.S. farm products in foreign markets.
Suppose Aiyanna's Pizzeria currently faces a linear demand curve and is charging a very high price per pizza and doing very little business. Aiyanna now decides to lower pizza prices by 5 percent per week for an indefinite period of time. We can
expect that each successive week: A. demand will become more price elastic. B. price elasticity of demand will not change as price is lowered. C. demand will become less price elastic. D. the elasticity of supply will increase.
A comparison of the average growth rates across time for developed nations indicates that:
A. nations with lower levels of income grow more slowly than those with higher levels of income. B. nations with lower levels of income will never be as rich as nations with high levels of income. C. nations with high levels of income experience a continuously increasing growth rate. D. nations with lower levels of income grow more quickly than those with higher levels of income.