The table above lists six points on the production possibilities frontier for grain and cars. What is the opportunity cost of producing the 5th ton of grain?
A) 16 cars per ton of grain
B) 6 cars per ton of grain
C) 3 cars per ton of grain
D) 2 cars per ton of grain
C
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When the price of a product increases, consumers shift their purchases to other products whose prices are now relatively lower. This statement describes
A. an inferior good. B. the substitution effect. C. the income effect. D. the rationing function of prices.
The fact that total wealth is fixed at any point in time is referred to as the
a. budget constraint. b. wealth constraint. c. wealth effect. d. hard asset effect. e. income effect.
Table 14.3In Table 14.3, Market 2 would be in equilibrium if buyers believed plums account for:
A. about 16.67% of the market. B. about 33.33% of the market. C. about 66.67% of the market. D. about 88.89% of the market.
The consuming units in an economy are known as
A. households. B. entrepreneurs. C. firms. D. factors.