Table 1.2 shows the hypothetical trade-off between different combinations of Stealth bombers and B-1 bombers that might be produced in a year with the limited U.S. capacity, ceteris paribus. Complete the table by calculating the required opportunity costs for both the B-1 and Stealth bombers. Table 1.2Production Possibilities for BombersCombinationNumber of B-1 BombersOpportunity cost(Foregone Stealth)Number of Stealth BombersOpportunity cost (Foregone B-1)A20NA195 B35 180 C45 150 D50 100NAThe highest opportunity cost in Table 1.2 for B-1 bombers in terms of Stealth bombers is
A. 10 Stealth bomber per B-1
B. 10 Stealth bombers per B-1
C. 10 B-1 bombers
D. 33 B-1 bombers
Answer: B
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If the price of a DVD decreases by 50 percent, the quantity demanded increases by 75 percent. The price elasticity of demand is:
A. –1.5 and is inelastic. B. –1.5 and is elastic. C. –0.67 and is elastic. D. –0.67 and is inelastic.
Which of the following would not increase labor productivity, ceteris paribus?
A. An increase in the number of participants in the labor force. B. Management training. C. Human capital investment. D. An increase in the quality of capital.
Refer to the graph below. If the industry were purely competitive, then the market price would be:
A. $25, which is higher than what the price would have been if the industry were a monopoly
B. $25, which is lower than what the price would have been if the industry were a monopoly
C. $20, which is higher than what the price would have been if the industry were a monopoly
D. $20, which is lower than what the price would have been if the industry were a monopoly
By a leading economic indicator, economists mean:
a. an indicator of future economic activity b. an indicator that reflects economic fluctuations as they occur. c. a highly accurate indicator that is easily measured. d. an indicator that predicts the level of inflation in an economy. e. any variable that follows changes in economic activity.