Suppose the production possibilities for two countries, producing either food or clothing, are shown in the above figure. They can each produce any linear combination as well
Measuring food on the horizontal axis, the joint production possibility frontier has a horizontal intercept of A) 10.
B) 20.
C) 30.
D) 50.
C
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If the marginal cost of production is $10, the elasticity of demand for group 1 is -1.5, the elasticity of demand for group 2 is -2.5, and the price paid by group 1 is $15, the price for group 2 is
A) $8.33. B) $27. C) $15. D) Impossible to tell.
The substitution effect occurs because when the price of one good increases, consumers will buy fewer substitute goods
a. True b. False Indicate whether the statement is true or false
Economics
A) is a social science. B) is concerned with limited resources. C) is concerned with unlimited wants. D) All of the above are correct.
In a perfectly competitive market where firms are currently experiencing economic profits in the short-run, which of the following is least likely to occur during the long-run?
A. An increase in the market quantity demanded. B. A rightward shift in the market supply curve. C. A decline in the ATC and MC curves. D. An increase in marginal revenue.