AP Micro

What does point B represent?

• Production at greater than the country's minimum potential

• Production is less than the country's minimum potential

• Productive inefficiency

• Productive efficiency

The inability to satisfy all wants at the same time

• Scarcity

• choice

• opportunity cost

• resources

Two alternative production possibility frontiers for apples and wheat are shown in the figures. As more wheat is produced, how will the opportunity cost of producing wheat, as represented in Figures 1 and 2, be affected? 

• Figure 1: Decrease / Figure 2: Increase

• Figure 1: Increase / Figure 2: Decrease

• Figure 1: No Change / Figure 2: Increase

• Figure 1: No Change / Figure 2: Decrease

Utility is the

• benefit or satisfaction that a person gets from the consumption of a good or service

• measure of how useful a resource is in the production process

• measure of productivity associated with a good or service

• economic term for consumption possibilities

The opportunity cost of a good is

• its price in dollars and cents.

• the value of alternative goods forgone in a decision.

• the value of what your first option is.

• none of the other options

The law of diminishing marginal utility is best defined as:

• As more units are consumed the marginal utility continually falls.

• As more units are consumed the marginal utility increases.

• As price decreases quantity demanded increases.

• As more units are consumed the opportunity cost increases.

Linavulu's per unit opportunity cost of producing handicrafts is

• 2 processed copra

• 3 processed copra

• 6 processed copra

• 1/2 processed copra

Answer explanation

Which of the following changes will most likely result in an increase in the demand for hamburgers in your hometown?

• The price of hot dogs decreases

• The price of drinks sold at hamburger restaurants increases

• Income in your town decreases and hamburgers are a normal good

• The local newspaper publishes a story on health problems caused by red meat

• The number of vegetarians in your town decreases and the population size remains the same.

Which of the following will most likely result in a decrease in the quantity of lemons demanded?

• an increase in the price of lemons

• an increase in the price of limes

• an increase in the price of lemonade

• an increase in the number of lemonade stands

• a decrease in consumer income

Which of the following will occur if consumer incomes increase?

• The demand for inferior goods will increase

• The demand for normal goods will increase

• The demand for all goods will increase

• The demand for normal goods will decrease

• The demand for all goods will decrease