AP ECONOMICS, MCQ REVIEW, 9-11-25

Economic models

• make no assumptions in order to remain as accurate as possible.

• are simplified versions of reality.

• magnify the complexity of economic issues in order to provide useful data.

• cannot be used to analyze real-world issues.

Which of the following is a positive economic statement?

• Foreign workers should not be allowed to work for lower wages than the citizens of a country.

• Scarcity necessitates that people make trade-offs.

• People should not buy SUVs.

• The government should mandate electric automobiles.

The production possibilities frontier model shows that

• 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.

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

The branch of economics which studies the behavior of entire economies is called

• normative economics.

• public economics.

• microeconomics.

• macroeconomics.

Refer to Figure 2-1. _______ is (are) unattainable with current resources.

• Point C

• Point A

• Point B

• Points A and C

• Point D

6) In economics, all of the following is counted as "capital" except

• A) factory buildings.

• B) machine tools.

• C) warehouses.

• D) money.

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

• linear

• bowed out

• non-linear

• bowed in

On a two-dimensional graph, _______ illustrate the effects of additional variables.

• adding an additional curve

• shifting curves

• moving along a curve

• eliminating a curve

Assume that Tomaso's Trattoria only produces pizzas and calzones. A combination of 36 pizzas and 30 calzones would appear

• on Tomaso's production possibilities frontier.

• inside Tomaso's production possibilities frontier.

• outside Tomaso's production possibilities frontier.

• at the horizontal intercept of Tomaso's production possibilities frontier.

A movement from X to Y in Figure 2-4

• is the result of advancements in food production technology only, with no change in the technology for plastic production.

• could occur because of an influx of immigrant labor.

• could be due to a change in consumers' tastes and preferences.

• is the result of advancements in plastic production technology only, with no change in food production technology.