Understanding Economics A Contemporary Perspective 8th Edition by Mark Lovewell Test bank

A. point a to point b
 
B. point a to point c
 
C. point b to point c
 
D. point b to point d
 
E. point c to point b
 
52.Consider the following two tables.

   

Suppose that North Cantina is producing 2 hamburgers and 17 hot dogs while South Cantina is producing 2 hamburgers and 21 hot dogs. We can conclude that: 
 


A. North Cantina is fully employing its resources but South Cantina is not
 
B. South Cantina is fully employing its resources but North Cantina is not
 
C. neither South Cantina nor North Cantina is fully employing its resources
 
D. both South Cantina and North Cantina are fully employing their resources
 
E. resources are perfectly shiftable between hotdogs and hamburgers
 
    
 
53.The shape of each production possibilities curve: 
 


A. indicates that resources shift perfectly from one use to another
 
B. indicates that resources are virtually unlimited
 
C. indicates that prices are constant
 
D. illustrates the law of increasing opportunity costs
 
E. shows that consumer wants are variable
 
54.The concept of opportunity cost is best represented by the: 
 


A. shift of the production possibilities curve from PP1 to PP2
 
B. move from point B on PP1 to point E on PP2
 
C. move from point E on PP2 to point A on PP1
 
D. move from point D inside PP1 to point B on PP1
 
E. move from point B to point C along PP1
 
55.An improvement in technology could be expected to: 
 


A. shift the production possibilities curve from PP1 to PP2
 
B. shift the production possibilities curve from PP2 to PP1
 
C. move the economy from point A to point C along PP1
 
D. move the economy from points A, B, or C on PP1 to point D inside PP1
 
E. move the economy from point C to point A along PP1
 
56.Which one of the following would shift the production possibilities curve from PP1 to PP2? 
 


A. the immigration of skilled workers into the economy
 
B. a worsening of diseases such as AIDS
 
C. an increase in consumer prices
 
D. a reduction in hourly wages
 
E. a change in consumer preferences
 
    
 
57.Points A, B, C, D, and E show: 
 


A. that the opportunity cost of bicycles increases while that of computers is constant
 
B. combinations of bicycles and computers that a society can produce by fully employing its resources
 
C. that the opportunity cost of computers increases while that of bicycles is constant
 
D. that the demand for computers is greater than the demand for bicycles
 
E. that the opportunity cost of both bicycles and computers are constant
 
58.If a society is currently producing 9 bicycles and 4 computers, the decision to increase computer output to 6 costs: 
 


A. 4 bicycles
 
B. 2 bicycles
 
C. 5 bicycles
 
D. zero because unemployed resources are available
 
E. irrelevant because this decision is inconsistent with consumer preferences
 
59.If a society is currently producing the combination of bicycles and computers shown by point D, the production of 2 more bicycles: 
 


A. cannot be realized because resources are fully employed
 
B. costs 1 computer
 
C. costs 2 computers
 
D. means that some resources are not fully employed
 
E. costs 6 computers
 
60.The law of increasing opportunity costs is reflected in a production possibilities curve that: 
 


A. is an upward-sloping straight line
 
B. is a downward-sloping straight line
 
C. bows in to the left
 
D. is any shape
 
E. bows out to the right
 
61.The problem of economic scarcity forces every country to determine: 
 


A. the shape of its production possibilities curve
 
B. the amount of economic resources that can be employed in production