Figure 2-2
Assume that U.S. agricultural land is used either to raise cattle for beef or to grow wheat. represents the production possibility frontier for beef and wheat. What is assumed constant as the economy moves from point F to point G?
a.
both d and e
b.
the money supply
c.
consumer tastes and preferences
d.
the level of currently available technology
e.
the amount of available resources
a
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When a person does not have to pay the full costs for using a scarce resource, then
A) the use of the resource is not affected since society pays for the resource. B) more of the resource will be used. C) the internal costs of using the resource are too high. D) the social costs of the resource are less than they would be if the "correct" amount of the resource were being used.
The marginal cost curve of pollution abatement
A) slopes upward because of the law of diminishing product. B) slopes upward because firms will maximize profits. C) slopes downward because of the law of diminishing marginal utility. D) slopes downward because of the law of diminishing returns.
For the equation of exchange to remain in balance
A. changes in P must equal the combined change in M and V. B. changes in P must equal changes in V. C. changes in Q must equal changes in M. D. the equation does not have to balance.
As the U.S. price level rises relative to price levels in other countries, U.S. _____
Fill in the blank(s) with the appropriate word(s).