The following economy produces two products.ProductsProduction Possibilities?ABCDEFTanks012345Autos10009508506503500Refer to the above table. The opportunity cost of each additional tank in terms of autos:
A. remains constant.
B. increases as more tanks are produced.
C. falls as more tanks are produced.
D. cannot be measured because there is no currency.
Answer: B
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Explain the impact, if any, of each of the following on the production possibilities curve:
a. Europe's population fell by 30 to 60 percent following an outbreak of bubonic plague, also known as Black Death, in the fourteenth century. b. In the next 20 years, a sizeable proportion of the United States labor force is expected to include many people who are above the age of 65 . c. Canada recently discovered large reserves of shale gas (shale gas is natural gas that is trapped in fine-grained sedimentary rock).
A characteristic of the long run is
A) all inputs can be varied. B) there are fixed inputs. C) there are both fixed and variable inputs D) plant capacity cannot be increased or decreased.
Gross domestic product (GDP) understates total economic activity because it ignores household production of goods and services
a. True b. False Indicate whether the statement is true or false
Mrs. Dodge has $8 million in income and pays no income taxes. Her income is most likely
A. capital gains. B. interest on corporate bonds. C. interest on municipal bonds. D. offset by mortgage interest.