Suppose there are two economies, Alpha and Beta, that have the same production possibilities frontiers. If Beta devotes more resources to produce capital goods than consumer goods as compared to Alpha, then in the future
A. Beta will experience greater economic growth than Alpha.
B. Alpha will not be able to achieve full employment or productive efficiency.
C. Alpha will experience greater economic growth than Beta.
D. Beta will not be able to achieve full employment or productive efficiency.
Answer: A
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Demand is inelastic only if the price elasticity of demand has an absolute value:
A. less than 0. B. greater than 5. C. of 1. D. greater than 0 but less than 1. E. greater than 1.
A market with one or a small number of firms but no barriers to entry is known as
A) a natural monopoly. B) a contestable market. C) a perfectly competitive market. D) monopolistic competition.
One of the reasons for the growth performance of free market economies is firms' use of innovation to compete with one another
a. True b. False Indicate whether the statement is true or false
Jen spends her afternoon at the beach, paying $1 to rent a beach umbrella and $11 for food and drinks rather than spending an equal amount of money to go to a movie. Her opportunity cost of going to the beach is:
A. the value she places on seeing the movie plus the $12 she spent on the umbrella, food and drinks. B. the $12 she spent on the umbrella, food and drinks. C. the value she places on seeing the movie. D. only $0 because she would have spent $12 to go to the movie.