When all resources used in production are not perfectly substitutable,
a. specialization does not lead to greater production
b. the economy or firm is producing at a point outside of its production possibilities frontier
c. there will be constant opportunity costs
d. the production possibilities frontier will be concave (bowed outward)
e. the economy or firm will only produce one good in equilibrium
D
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Which of the following would cause a consumer to purchase less of a good when the price of the good rises?
a. The income effect b. The substitution effect c. Both a and b d. Neither a nor b
When there is an inflationary gap: a. Employment exceeds full employment
b. Employment equals full employment. c. Employment is less than full employment. d. Any of the above is possible.
The gains from trade are divided in proportion to the price changes that trade brings to the trading countries.
Answer the following statement true (T) or false (F)
A) Sam pays $600 for 30 days of guitar classes. He attends an hour-long class every day. If, instead of attending class, he works at a part-time job, he would be paid $5 an hour. Or, he could work at a fast-food outlet and earn $9 per hour
Once he has already paid a nonrefundable fee of $600 to enroll in the class, what is his opportunity cost of attending each hour of class? b) Suppose workers decide to work more and consume less leisure when their hourly wage rate increases. What could explain this behavior?