Blog

Where on a graph of a production possibilities curve would a point showing that an economy is using its resources efficiently be located?

If a 10 percent increase in the price of good X results in a 20 percent decrease in the quantity of good Y demanded, which of the following is true?

Let MUS be the marginal utility of a sandwich, MUh be the marginal utility of a hot dog, Ps be the price of a sandwich, and Ph be the price of a hot dog. When the price of the goods is zero, Pat eats a sandwich. When Pat has to pay, she eats a hot dog. When Pat has to pay, which of the following is necessarily true?

Two alternative production possibility frontiers for apples and wheat are shown in the figures below. There are two figures, titled Figure 1 and Figure 2. On each figure, the horizontal axis is labeled Wheat and the vertical axis is labeled Apples. Figure 1 shows a downward sloping straight line starting from a point on the vertical axis and ending at a point on the horizontal axis. Figure 2 shows a downward sloping curve that starts from the vertical axis, curves outward away from the origin, and ends at a point on the horizontal axis. As more wheat is produced, how will the opportunity cost of producing wheat, as represented in Figures 1 and 2, be affected?

The figure shows the graph of a curve and 2 data points in a plane. The horizontal axis is labeled “Good X,” and the numbers 0 through 5, in increments of 1, are indicated. The vertical axis is labeled “Good Y,” and the numbers 0 through 8, in increments of 1, are indicated. The curve begins at the coordinates 0 comma 8 and moves downward and to the right, gradually at first and then more steeply, and ends at coordinates 5 comma 0. Two points lie on the curve at the following coordinates: point M at 2 comma 7, and point Z at 4 comma 4. The graph provided shows the production possibilities curve for a country’s economy. The economy is currently producing at point Z. What is the opportunity cost of changing production to point M?

A graph in the first quadrant is shown with quantity on the horizontal axis and price in dollars on the vertical axis. The values Q prime and Q with Q prime less than Q are labeled on the horizontal axis, and the values 9.45, 10, 10.45, and 11 are labeled on the vertical axis. A line is plotted on the graph that is labeled demand and starts near the top of the vertical axis, above the value 11, and decreases to the right, ending on the horizontal axis. Two other parallel lines are plotted on the graph, with the upper line labeled supply after tax and the lower line labeled supply. Both lines start on the vertical axis below 9.45 and increase to the right. The upper line crosses the demand line at quantity Q prime and price 10.45, and dashed reference lines are drawn from the axes to this intersection. The lower line crosses the demand line at quantity Q and price 10, and dashed reference lines are drawn from the axes to this intersection. Dashed reference lines are also drawn from the price 9.45 to quantity Q prime and the supply line, and from price 11 to quantity Q and the supply after tax line. According to the diagram, what is the dollar amount of the unit tax?

A production possibilities curve (PPC) graph showing the trade-off between capital goods and consumer goods. Points J and S are inside the curve (inefficient), N and R are on the curve (efficient), and M is outside the curve (unattainable with current resources). Of the feasible and efficient points on the production possibilities curve (PPC) above, producing at which point will lead to the most economic growth in the future?

The curved line begins approximately three fourths up on the vertical axis, curves down and to the right, passes through point X, approximately one third up along the horizontal axis, continues down and to the right, passes through point Y slightly more than halfway to the right along the horizontal axis and approximately halfway up along the vertical axis, continued down and to the right, passes though point Z, approximately two thirds to the right along the horizontal axis and less than halfway up the vertical axis, and ends when it reaches the horizontal axis. Point W is below the curve, and point V is above the curve. Given the production possibilities curve above, which of the following represents a movement from efficiency to inefficiency?

The supply curve for automobiles will shift to the left in response to

Karen works part-time at a local convenience store and earns $10 per hour. She wants to spend next Saturday afternoon attending a music concert. The full price of a concert ticket is $75, but Karen was able to get a discounted price of $50 from a friend who purchased the ticket but has become unable to attend. If Karen took 4 hours off from her job to attend the concert, what was her opportunity cost of attending the concert?