Production Possibilities Curve

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

• Scarcity
• 2 boats
• 2 trucks
• 3 boats

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

• 1 boat
• 2 boats
• 2 trucks
• 3 trucks

If a natural disaster strikes, the production possibilities curve can shift

• No shift
• To the left
• To the right
• Outward on one axis only

What can cause a production possibilities curve to move to the right?

• thousands of people move out of the country
• an epidemic kills thousands of young men and women
• a new invention lowers the cost of production
• the population is growing increasingly old

What is the Diminishing Marginal Utility?

• The more you have of something, the less satisfaction you gain from it.

• electricity costs less in small cities and more in big cities.

• satisfaction increases with quantity not quality.

• electricity costs more in small cities and less in big cities.

What does point B represent?

• Production at greater than the country's minimum potential
• Production is less than the country's minimum potential
• Production is greater than the country's maximum potential
• Production at the country's maximum potential

What does point Y represent on the PPC?

• Efficiency
• Unattainable / impossible
• Inefficency
• Nothing

Which of the following would not be a factor in shifting the frontier line?

• discovery of a new resource

• a business paying for more research and development

• The development of a more efficient way to make batteries.

• Closing trade with another country

If there is improved technique of Production in both the goods , how the PPC will be affected?

• Leftward shift of PPC
• Rightward shift of PPC
• Rotation of PPC
• None of the above

If a natural disaster strikes, where would a production possibilities curve most like shift

• No shift

• To the left (as seen in Case 1)

• To the right (as seen in Case 2)

• Up the Y axis (as seen in case 3)