AP Econ Unit 1

Movement along a PPC shows which of the following?

The trade-offs society faces

A PPC can shift inward if there is

A natural disaster

A country produces computers and rice. If resources are fully employed and there is technological progress only in the production of rice the opportunity cost of producing computers and rice will change in which of the following ways?

The opportunity cost of computers will increase while the opportunity cost of rice will decrease

The table below shows the maximum number of palm leaves or coconuts that Robert and Frank can pick respectively in a single day which of the following is true?

Robert and Frank can both benefit from trade with each other if 1 coconut is traded for 3 palm leaves

relative to a command economy resources in a market economy or more commonly allocated by

The price (market) system

donna and Robin produce smoothies and pizza, in one hour Donna can make 20 smoothies or 10 pizzas in one hour Robin can make 18 smoothies or six pizzas. Which of the following statements is true?

donna has a comparative advantage in making pizzas, and robin has a comparative advantage in making smoothies

given the production possibilities curve above, which of the following represents a movement from efficiency to inefficiency?

Point X to point W

The study of economics exists because people are confronted with the basic problem of

scarcity

The amount of product Z that must be forgone in order to obtain/produce some amount of product why is called...

opportunity cost

which of the following is necessary in a well functioning capitalist and economy but not in a command economy?

protection of property rights

which of the following conditions is necessary for productive efficiency?

The firm is producing a given level of output with a least-cost combination of inputs

A firm is producing the allocative we efficient level of output if....

They are producing a combination of goods that is most desired by society

The table below shows the number of hours it takes for Kim to install a computer or to paint a garage and for Maria to install a computer repair garage. If tasks are assigned according to comparative advantage which of the following is true?

Kim should install computers and Maria should paint garages

which of the following is true about an economy's production possibility curve?

it shows the alternative combinations of goods that can be produced by fully employed scarce resources

And outward shift of the production possibilities curve can be caused by....

improving technology

based on the production possibilities curve for books and pencils shown above what is the opportunity cost of producing a book?

3 pencils

marginal analysis suggests that an individual will consume one additional unit of a good if the...

additional benefit is greater than the additional cost

improvements in technology for producing all goods must result in....

an outward shift of the production possibilities curve

Which of the following is true in a capitalist economy?

Prices serve as incentives for factors of production to move to the markets where they are most valued

according to the production possibilities curve above, which of the following is true?

The opportunity cost of producing another unit of either good remains constant as the production of the other good increases

As a factor of production, capital refers to the

tools and machinery used to produce goods and services

using the same amount of time and resources, Jack can assemble either 10 bikes or 5 computers, whereas Sam can assemble either 5 bikes or 5 computers. Based on the data, which of the following statements is correct?

Jack has a comparative advantage in assembling bikes

If nations specialize according to their comparative advantage and engage in international trade with each other, each nation can

Shift PPC to the right

After graduating from high school, Maria chose to go to college, while Omar chose to work full-time. Which of the following best describes the opportunity cost for their decisions

Maria's opportunity cost includes the salary she could have earned if she had gone to work

The basic economic problem of all economies is essentially one of deciding how to make the best use of

Limited resources to satisfy unlimited wants

assume that an economy produces televisions and shoes which of the following will cause a production possibility curve for this economy to shift outward?

An increase in the labor force

The table above shows the amount of labor required to produce a unit of corn and a unit of shoes in Brazil and Spain. If both countries have equal numbers of workers, what pattern of international trade between Brazil and Spain is most likely to emerge?

Brazil will export corn and import shoes

which of the following explains why a production possibilities curve is often represented as concave (bowed out) from the origin?

increasing opportunity cost

Which of the following best defines opportunity cost?

It is the amount of one product that must be given up in order to produce an additional unit of another product

After graduating from high school, Peggy Smith decided to enroll in a two year program at the local community college rather than a sept a job that offer the salary of $12,000 per year. If the annual tuition and fees are $4,600, the annual opportunity cost of attending the community college is

$16,600