AP Micro - Unit 1 REVIEW

Front

The crucial problem of economics is: Allocating scarce productive resources to satisfy wants

Back

Allocating scarce productive resources to satisfy wants

Front

When one decision is made, the next best alternative not selected is called

Back

opportunity cost

Front

Which of the following is true if the PPC is concave to the origin? Resources are perfectly substitutable, It's possible to produce more of both products, Both products are equally capable of satisfying consumer wants, The price of the two products are the same, As more of one good is produced, increasing amounts of the other good must be given up.

Back

As more of one good is produced, increasing amounts of the other good must be given up.

Front

In which way does a straight-line production possibilities curve differ from a concave production possibilities curve?

Back

A straight-line production possibilities curve has a constant opportunity cost.

Front

The law of increasing opportunity cost is reflected in the shape of the

Back

Production possibilities curve concave to the origin (“bowed-out”)

Front

Which of the following would cause an inward shift of the production possibilities curve? An increase in unemployment, An increase in inflation, An increase in capital equipment, A decrease in consumer demand, A decrease in the population

Back

A decrease in the population

Front

Which of the following would cause an outward shift in the production possibilities curve? An increase in unemployment, An increase in inflation, An increase in capital equipment, A decrease in natural resources, A decrease in the number of workers

Back

An increase in capital equipment

Front

What is the opportunity cost of moving from point B to C on the curve?

Back

30 tons of wheat

Front

What is the opportunity cost of making each Mustang if Ford can produce 200 Mustangs or 400 Escapes?

Back

2 Escapes

Front

Which country has the absolute advantage in producing cars? United States: 50 Cars and 2 Planes; Great Britain: 40 Cars and 2 Planes

Back

United States