Opportunity Costs and Production Possibilities Frontier

Front

True or False: Everything that is scarce requires a choice, and these choices always involve a tradeoff.

Back

True

Front

What is opportunity cost?

Back

the opportunity one has to give up in order to gain something else

Front

What is the production possibilities curve?

Back

a graph that shows how much an economy can produce between 2 goods

Front

How do you satisfy your unlimited wants in a world of limited resources? Options: by making more money, by making choices, by stealing, by setting a budget

Back

by making choices

Front

What is the fundamental problem of every society? Options: labor costs, scarcity, economic interdependence, market fluctuation

Back

scarcity

Front

Land, Labor, Capital, and Entrepreneurship

Back

Factors of Production

Front

The opportunity cost of increasing production from 7 to 9 trucks is

Back

3 boats

Front

The opportunity cost of increasing production from 4 to 7 boats is

Back

2 trucks

Front

Movement down the PPF curve indicates that the opportunity cost of more capital goods is producing more consumer goods

Back

False

Front

Efficiency is producing the maximum possible output from available resources.

Back

True