Refer to the above diagram. A shortage of 160 units would be encountered if price was:
A. $1.10, that is, $1.60 minus $.50.
B. $.50.
C. $1.00.
D. $1.60.
Answer: B
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The quantity effect of a price decrease by a monopolist is based on:
A) the Law of Supply. B) the Law of Demand. C) the Law of Increasing Returns. D) the Law of Diminishing Returns.
If both imports and exports rose, a. AD would decrease
b. AD would increase. c. AD would decrease if exports rose more than imports. d. AD would increase if exports rose more than imports.
In which one of the following situations is the political process most likely to result in both the acceptance of efficient (productive) programs and the rejection of inefficient (counterproductive) political activities?
a. The people who benefit from a government program pay the costs of the program roughly in proportion to the benefits that each receives. b. The benefits are highly concentrated, and the costs are widespread among voters. c. The costs are highly concentrated, and the benefits are widespread among voters. d. The benefits accrue primarily in the future, while the costs are more visible during the current period.
Within the production possibilities frontier (PPF) framework, choice is depicted by the
A) PPF itself. B) PPF being bowed outward. C) need to select among the points making up the PPF. D) straight-line PPF.