The slope of the PPF can be expressed as:
a. the ratio of abundance of capital to labor.
b. the preferences of consumers in terms of marginal utility.
c. the ratio of the quantities of good 1 and good 2.
d. the negative of the ratio of the marginal products of labor in producing each good
Ans: d. the negative of the ratio of the marginal products of labor in producing each good
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Which of the following increases in labor demand is due to a change in the product demand?
A. A decrease in the price of trucks decreases the cost of transporting goods, thus increasing the demand for truckers. B. Tourism increases in popularity, increasing the demand for workers at tourist resorts. C. A change in work rules increases output per worker in the auto industry, thus increasing the demand for auto workers. D. Access to computers increases the productivity of mail order businesses, thus increasing the demand for their workers.
For certain intangibles that cannot be measured, it is best to
A. guess. B. exclude them from cost benefit analysis, and then calculate how large they must be to reverse the decision. C. reevaluate using the Hicks-Kaldor criterion. D. leave it to the private sector to decide on value.
Suppose a study showed that as the income of doctors increased, doctors spent more time on the golf course and less in the office. What would such a conclusion say about the relative sizes of substitution and income effects?
A local restaurant offers an "all you can eat" Sunday brunch for $12. Susan eats four servings, but leaves half of a fifth helping uneaten. Why?
A. Her marginal value of a serving of brunch has fallen below $12. B. Her marginal value of a serving has fallen below $2.36 ($12 divided by 5 servings). C. Her marginal value of food has fallen to zero. D. The total value she places on brunch today exactly equals $12.