The bowed-out shape of the production possibilities frontier indicates increasing opportunity costs
a. True
b. False
A
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Because of increasing opportunity costs, the production possibility curve:
A. Is bowed out from (or concave to) the origin B. Can be either downward- or upward-sloping C. At first rises, then falls eventually D. Is a straight downward-sloping line
According to the Lucas supply function, in combination with the assumption that expectations are rational, change in government policy can affect real output only if
A. the policy change is a mix of both fiscal and monetary policy changes. B. expansionary policy changes are made. C. the policy change is correctly anticipated by the public. D. the policy change is a surprise.
Doug's Dog Grooming is a perfectly competitive firm charging $5 per dog grooming
Doug's Dog Grooming has the total and marginal product of labor schedules in the above table and can hire workers from a perfectly competitive labor market for $15 per hour. What is the value of marginal product of the third worker? A) $5 B) $25 C) $15 D) $375
Fixed costs are
a. costs that vary with output b. always equal to marginal costs c. costs that do not vary with output d. equal to total costs