Exhibit 15-1 Production possibilities curves
In Exhibit 15-1, the production possibilities curves of wheat and corn for Nabia and Pada are presented. In Pada the cost of producing one more unit of corn is equal to:
A. 3 units of wheat.
B. 3 units of corn.
C. 1/3 unit of wheat.
D. 15 units of wheat.
Answer: A
You might also like to view...
Why don't wages fall so that everyone with the skills and desire gets a job?
A. The government might prevent it, through minimum-wage legislation. B. Firms themselves might prevent it, by voluntarily choosing to pay higher wages than necessary. C. Labor unions might prevent it, through bargaining backed by the threat to strike. D. All of these are reasons why wages may not fall to equilibrium.
If a teacher tells a student that those who attend the study session typically score higher on the final exam
A. the student has a negative incentive to attend the study session because she will be punished if she does not go. B. the student has a positive incentive to attend the study session because she may get a higher grade. C. a "C" student will be making an irrational decision if she decides to skip the study session since she has plenty of time to go. D. the student has no greater incentive to attend because there is no guarantee she will get a higher grade on the exam.
Over time in a growing economy, the long run aggregate supply curve will
A. become increasingly steep. B. move so as to match the short run aggregate supply (SRAS) curve. C. shift inward to the left. D. shift outward to the right.
A monopolistically competitive firm maximizes profit where
A. MR > MC. B. P = MC. C. MC > MR. D. MR = MC.