Refer to the information provided in Figure 2.2 below for the economy of Microland to answer the question(s) that follow.
Figure 2.2Refer to Figure 2.2. You correctly deduce that all resources are fully employed and there are no production inefficiencies if this economy is currently operating at a point
A. outside the production possibility frontier.
B. inside the production possibility frontier.
C. either inside or along the production possibility frontier.
D. along the production possibility frontier.
Answer: D
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The production function is
a. the increase in the amount of output from an additional unit of labor. b. influenced by the productivity of workers. c. the marginal revenue produce minus the wage rate paid to workers. d. All of the above are correct.
Suppose health-care reform X makes it unlawful for insurance companies to deny insurance to persons with a preexisting disease. One unintended effect of this reform is that some people
A) will buy more health insurance than they would have without reform X. B) may wait until they have a particular disease before they buy health insurance. C) will try to work longer hours, to earn more income, to pay for increasing health insurance premiums. D) a and c E) none of the above
Figure 2-9
Assume that the publishing industry produces novels and textbooks, as shown in the production possibilities frontier in . Between points F and G, the opportunity cost of ten more novels equals __________. Between points G and H, the opportunity cost of ten more novels equals __________.
a.
0.4 textbooks; 0.5 textbooks
b.
4 textbooks; 5 textbooks
c.
4 million textbooks; 5 million textbooks
d.
2.5 textbooks; 2 textbooks
e.
10 million textbooks; 5 million textbooks
In 2001, which of the following countries replaced its currency with the U.S. dollar?
A. Hong Kong B. Argentina C. Panama D. El Salvador