Econ: Scarcity and the PPC

What is the term for what you sacrifice in order to pursue a different option?

• capital

• land

• opportunity cost

• the price of the product

• money cost

Why is the PPC concave to the origin?

• Due to inefficiencies in the economy

• Because of opportunity cost

• As a result of the law of increasing costs

• Because of constant opportunity costs

• Due to the fact that the extreme points are not well established

What happens when the economy operates at a point on the production possibilities curve (PPC)?

• Resources are utilized efficiently and fully.

• Prices remain constant.

• Resources will not run out.

• Prices increase.

• Opportunity cost remains consistent.

Which of the following statements accurately describes the law of increasing costs?

• The law of increasing costs does not apply to apples.

• The law of increasing costs is the result of resources not being perfectly adaptable between the production of two goods.

• The law of increasing costs implies that prices will rise when the costs of making a good rise.

• The law of increasing costs implies that opportunity cost is constant.

• The law of increasing costs cause the PPC to shift to the right.

What is the outcome when an economy functions within the PPC?

• Resources are utilized to their maximum capacity

• Prices remain stable

• Resources will not run out

• Prices will increase

• Opportunity cost remains consistent

What is the primary cause of the law of increasing costs?

• Resources can be easily shifted between the production of two goods

• Opportunity cost varies

• Prices decrease as production costs rise

• It is limited to specific types of goods

• It results in a leftward shift of the PPC

Why is the importance of scarcity emphasized in economics?

• It signifies that prices will increase when the costs of production rise

• It leads to a rightward shift in the PPC

• It indicates that opportunity cost remains consistent

• It underscores the finite nature of resources compared to infinite desires

• It is not relevant to apples