The production possibilities curve (PPC) illustrates economic growth by a(n)
A) bowed-out shape of the PPC.
B) outward shift of the PPC.
C) inward shift of the PPC.
D) movement along the PPC.
B
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An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase B. increase; increase C. decrease; decrease D. increase; decrease
In general, production possibilities curves are "bowed out" because:
A) it's wasteful to produce too much of any one good. B) people generally prefer to consume goods in appropriate combinations. C) of the law of increasing opportunity cost. D) of the law of demand.
In 2005, the European Union began a program to
A) reduce greenhouse gas emissions by 10 percent within 5 years. B) eliminate greenhouse gas emissions by 50 percent within 15 years. C) subsidize firms that pollute more than a given limit. D) allow the trading of carbon-dioxide permits among firms.
In Figure 23.1, for a good with no externality, which area represents the total revenue to the producer? 
A. 0BCQ* B. BP*C C. 0P*CQ* D. AP*C