11) If Harold must decrease production of some other good : 1417859
11) If Harold must decrease production of some other good to increase production of good X, then Harold
A) is producing on his production possibilities frontier.
B) is producing outside his production possibilities frontier.
C) is producing inside his production possibilities frontier.
D) must prefer good X to any other good.
E) has too few capital goods.
12) A situation in which resources are either unused or misallocated or both is represented in a production possibilities frontier diagram by
A) any point on either the horizontal or the vertical axis.
B) a point above or to the right of the production possibilities frontier.
C) a point outside the production possibilities frontier.
D) a point inside the production possibilities frontier.
E) a point on or inside the production possibilities frontier.
13) A production possibilities frontier is negatively sloped because
A) more goods are purchased as price falls.
B) of opportunity cost.
C) some resources are unused.
D) there is not enough capital in the economy.
E) of increasing consumption.
14) Ted chooses to study for his economics exam instead of going to the concert. The concert he will miss is Ted's ________ of studying for the exam.
A) monetary cost
B) absolute cost
C) opportunity cost
D) discretionary cost
E) comparative cost
15) Opportunity cost of an action is
A) the best choice that can be made.
B) the highest-valued alternative forgone.
C) the money cost.
D) the comparative cost.
E) the absolute cost.
16) The concept of opportunity cost
A) cannot be explained by using a production possibilites frontier.
B) explains that goods are swapped for other goods.
C) implies that when a person is more efficient in the production of one good, he should produce that good and exchange it for some good that he is relatively less efficient at producing.
D) implies that a double coincidence of wants must be present for exchange to take place.
E) implies that because productive resources are scarce, we must give up some of one good to acquire more of another.
17) On a graph of a production possibilities frontier, opportunity cost is represented by
A) a point on the horizontal axis.
B) a point on the vertical axis.
C) a ray through the origin.
D) the slope of the production possibilities frontier.
E) the x-axis intercept.
18) Production efficiency is achieved when
A) the production possibilities frontier shifts outward at an even pace.
B) there are no more tradeoffs.
C) all resources are equally productive in all activities.
D) resources are not equally productive in all activities.
E) we produce goods and services at the lowest possible cost.
19) A tradeoff exists when
A) we move from a point within the production possibilities frontier (PPF) to a point on the PPF.
B) we move from a point on the PPF to a point within the PPF.
C) the PPF shifts outward.
D) we move along the PPF.
E) the PPF shifts towards the origin.
20) Which of the following quotations best illustrates a tradeoff?
A) "If the firm reorganized its production process, it could produce more widgets and more gadgets."
B) "The firm should sell more gadgets, even if it means less widget sales."
C) "The more and more gadgets the firm produces, the bigger the fall in widget production."
D) "If the firm invests more in capital equipment, it can expand sales next year."
E) "The firm has been able to lower costs due to its extensive experience in building widgets."