The graph above shows the PPC for a country that can produce oil or televisions. The straight line is the trade line and CPC if production is at Point A. Is this country producing the optimal mix of oil and televisions to maximize its income? Carefully explain how you know
What will be an ideal response?
No, the country is not producing the optimal production mix. Since the slope of the trade line is steeper than the slope of the PPC at point A, the country could increase its income by producing relatively more oil and relatively fewer televisions, until the trade line is tangent to the PPC.
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The marginal cost of an activity ________ as you do more of it
A) increases B) decreases C) doesn't change D) changes only if the marginal benefit of the activity does not change E) changes only if the marginal benefit of the activity changes
Refer to Table 4-7. If a minimum wage of $11.50 an hour is mandated, what is the quantity of labor demanded?
A) 40,000 B) 570,000 C) 610,000 D) 1,180,000
Marginal revenue product is the
a. additional revenue from one additional dollar increase in price. b. change in the revenue product resulting from one additional unit of input. c. additional revenue from one additional unit of input. d. change in revenue resulting in one additional dollar in price.
The study of how people choose between the alternatives available to them is
A. definition of economics B. model of demand C. theory of opportunity costs D. method of distinguishing between microeconomics and macroeconomics.