Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, as the economy moves from Point E to Point A, the opportunity cost of hybrid cars, measured in terms of motorcycles
A. increases.
B. initially increases, then decreases.
C. decreases.
D. remains constant.
Answer: A
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The long-run equilibrium price-output combination for a monopolist is economically inefficient because:
a. it does not operate on the minimum point of its marginal-cost curve. b. it does not produce the level of output at which price equals marginal cost. c. consumer surplus is maximized but not producer surplus. d. producer surplus is maximized but not consumer surplus. e. it operates on the downward sloping portion of the average-total-cost curve.
The long-run average total cost curve is constructed from the
A. Lowest average total cost for producing each level of output. B. Minimum points of the long-run marginal cost curves. C. Minimum points of the short-run marginal cost curves. D. Minimum points of the short-run average variable cost curves.
In the mid-1970s, changes in oil prices greatly affected U.S. inflation. When oil prices rose, the U.S. would experience ________.
A. cost-push inflation and falling output B. demand-pull inflation and falling output C. cost-push inflation and rising output D. demand-pull inflation and rising output
The economic return to oil resources is called:
a. Rent. b. Wages. c. Profits. d. Interest. e. None of the above.