Using Figure 1.6, we know the production of 90 units of soda and 1 unit of pizza is 
A. impossible because we have the resources but do not have the technology.
B. possible, but there would be unemployed resources.
C. possible, but only if all resources were fully employed.
D. impossible because we have the technology but do not have the resources.
Answer: B
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The Federal Reserve fears that the United States economy is growing too slowly and is stuck in a recession. To move the economy back to its potential GDP, the most likely policy action for the Fed is to ________ the federal funds and thus ________
A) raise; increase aggregate demand B) raise; decrease aggregate demand C) lower; increase aggregate supply D) lower; decrease aggregate supply E) lower; increase aggregate demand
Refer to Figure 3-5. At a price of $20
A) there would be a surplus of 8 units. B) there would be a shortage of 4 units. C) there would be a surplus of 0 units. D) there would be a shortage of 8 units.
The view that government intervention obstructs long-run economic growth is attributed to
a. external cycle theorists b. internal cycle theorists c. real business cycle theorists d. housing cycle theorists e. innovation cycle theorists
Suppose that if your income is $20,000, your tax is $4,000, but if your income is $40,000, your tax is $8,000. Such a tax is
A. Regressive. B. Proportional. C. Progressive. D. A merit tax.