macroeconomics ch 2

Comparative advantage means the ability to produce a good or service

• of a higher quality than any other producer

• at a lower selling price than any other producer

• at a higher profit level than any other producer

• at a lower opportunity cost than any other producer

If society decides it wants more of one good and all resources are fully​ utilized, then

• it is unable to do this unless technology advances

• it has to give up some of another good and incur some opportunity costs

• additional resource supplies will have to be found

• more unemployment will occur

The production possibilities frontier shows the​ ________ combinations of two products that may be produced in a particular time period with available resources.

• only

• equitable

• minimum attainable

• maximum attainable

The production possibilities frontier model shows that

• f all resources are fully and efficiently​ utilized, more of one good can be produced only by producing less of another good.

• 
  if consumers decide to buy more of a product its price will increase.

• economic growth can only be achieved by free market economies.

• 
  a market economy is more efficient in producing goods and services than is a centrally planned economy.

An outward shift of a​ nation's production possibilities frontier represents

• an impossible situation

• a situation in which a country produces more of one good and less of another

• rising prices of two goods on the production possibilities frontier model

• economic growth

The points outside the production possibilities frontier are

• unattainable

• ineffcient

• efficient

• attainable

If the production possibilities frontier is​ ________, then opportunity costs are constant as more of one good is produced.

• bowed out

• non-linear

• bowed in

• linear

You have an absolute advantage whenever you

• can produce more of something than others with the same resources

• are better educated than someone else

• prefer to do one particular activity

• can produce something at a lower opportunity cost than others

Without an increase in the supply of the factors of​ production, how can a nation achieve economic​ growth?

• 
  through technological advancement which enables more output with the same quantity of resources

• 
  by producing more​ high-value goods and fewer​ low-value goods

• 
  by increasing the prices of factors of production

• 
  by lowering the prices of factors of production

The term​ 'property rights' refers to

• 
  the ability to exercise control over​ one's own resources within the confines of the law.

• 
  the physical possession of a house or any other property which the owner legally purchased.

• 
  the right of a business not to have its assets confiscated by the government in the event that the business is accused of committing fraud.

• 
  the​ government's right to appropriate land from wealthy land owners to redistribute to peasants.