Question 1

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. Which of the following statements is TRUE?
A) Producing 0 chocolate bars and 100 cans of cola is both attainable and efficient.
B) Producing 20 chocolate bars and 80 cans of cola is attainable, but inefficient.
C) Producing 30 chocolate bars and 38 cans of cola is only attainable with an increase in technology.
D) Producing 40 chocolate bars and 0 cans of cola is unattainable and inefficient.

Accepted Answer

The answer of 
-The above table shows production points on...

Question 2

-The table above lists six points on the production possibilities frontier for grain and cars. What is the opportunity cost of producing the 26th car?
A) 2 tons of grain per car
B) 4 tons of grain per car
C) 0.25 tons of grain per car
D) 0.5 tons of grain per car

Accepted Answer

The opportunity cost of producing the 26th car is the amount of grain that must be given up to produce one more car. If the table shows that moving from 25 to 26 cars results in a decrease of 0.5 tons of grain, then the opportunity cost is 0.5 tons of grain per car.

Question 3

In one day, Sue can change the oil on 20 cars or change the tires on 20 cars. In one day, Fred can change the oil on 20 cars or change the tires on 10 cars. Sue's opportunity cost of changing oil is ________ than Fred's and her opportunity cost for changing tires is ________ than Fred's.
A) greater; less
B) less; greater
C) less; less
D) greater; greater

Accepted Answer

Sue's opportunity cost of changing oil is greater than Fred's because she can change the tires on 20 cars in one day, while Fred can only change the tires on 10 cars in one day. Her opportunity cost for changing tires is less than Fred's because she can change the oil on 20 cars in one day, while Fred can only change the oil on 20 cars in one day.

Question 4

-The above table shows production combinations on a country's production possibilities frontier. Which of the following is an example of a point that is unattainable?
A) 0 units of good X and 40 units of good Y
B) 6 units of good X and 28 units of good Y
C) 10 units of good X and 16 units of good Y
D) 3 units of good X and 35 units of good Y

Accepted Answer

The answer of 
-The above table shows production combinations on...

Question 5

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. What is the opportunity cost of one chocolate bar if Sweet-tooth Land moves from point C to point D?
A) 30 cans of cola per chocolate bar
B) 10 cans of cola per chocolate bar
C) 3 cans of cola per chocolate bar
D) 1/3 can of cola per chocolate bar

Accepted Answer

Moving from point C to point D, Sweet-Tooth Land increases its chocolate bar production by 10 bars (from 40 to 50) and decreases its cola production by 30 cans (from 90 to 60). Therefore, the opportunity cost of producing one additional chocolate bar is 30 cans of cola divided by 10 chocolate bars, which equals 3 cans of cola per chocolate bar.

Question 6

At one point along a PPF, 50 tons of coffee and 100 tons of bananas are produced. At another point along the same PPF, 30 tons of coffee and 140 tons of bananas are produced. The opportunity cost of a ton of coffee between these points is
A) 7/5 of a ton of bananas per ton of coffee.
B) 1/2 of a ton of bananas per ton of coffee.
C) 5/7 of a ton of bananas per ton of coffee.
D) 2 tons of bananas per ton of coffee.

Accepted Answer

The opportunity cost of producing an additional ton of coffee is the amount of bananas that must be given up. Moving from 30 to 50 tons of coffee, 20 tons of coffee are produced, and 40 tons of bananas are given up (140 - 100). Thus, the opportunity cost is 40/20 = 2 tons of bananas per ton of coffee.

Question 7

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. A movement from ________ represents the greatest opportunity cost of increasing cola production.
A) point E to point D
B) point D to point C
C) point C to point B
D) point B to point A

Accepted Answer

The answer of 
-The above table shows production points on...

Question 8

-The table above lists six points on the production possibilities frontier for grain and cars. From this information you can conclude that production is inefficient if this economy produces
A) 6 tons of grain and 18 cars.
B) 4 tons of grain and 26 cars.
C) 2 tons of grain and 27 cars.
D) 8 tons of grain and 10 cars.

Accepted Answer

Production is inefficient if the economy is producing less than it could with the resources available. Choice C represents a point inside the production possibilities frontier, indicating inefficiency, as more of both goods could be produced with the available resources.

Question 9

-The table above lists six points on the production possibilities frontier for grain and cars. What is the opportunity cost of producing the 5th ton of grain?
A) 16 cars per ton of grain
B) 6 cars per ton of grain
C) 3 cars per ton of grain
D) 2 cars per ton of grain

Accepted Answer

The opportunity cost of producing the 5th ton of grain is the number of cars that must be given up. If the table shows that moving from the 4th to the 5th ton of grain results in a decrease of 3 cars, then the opportunity cost is 3 cars per ton of grain.

Question 10

At one point along a PPF, 10 pizzas and 7 sandwiches can be produced. At another point along the same PPF, 9 pizzas and 10 sandwiches can be produced. The opportunity cost of a pizza between these points is ________ per pizza.
A) 7/10 of a sandwich
B) 10/7 of a sandwich
C) 1/3 of a sandwich
D) 3 sandwiches

Accepted Answer

The answer of At one point along a PPF, 10...

Question 11

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. Which of the following is an example of a point that is inefficient?
A) 0 chocolate bars and 100 cans of cola
B) 20 chocolate bars and 80 cans of cola
C) 32 chocolate bars and 40 cans of cola
D) 38 chocolate bars and 0 cans of cola

Accepted Answer

The answer of 
-The above table shows production points on...

Question 12

At one point along a PPF 40 tons of wheat are produced while 80 tons of rice are produced. At another point along the same PPF, 41 tons of wheat are produced while 70 tons of rice are produced. The opportunity cost of producing a ton of wheat between these points is ________ per ton of wheat.
A) 1/2 ton of rice
B) 10 tons of rice
C) 1/10 ton of rice
D) 4/7 ton of rice

Accepted Answer

The answer of At one point along a PPF 40...

Question 13

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. What is the opportunity cost of one can of cola if Sweet-tooth Land moves from point C to point B?
A) 20 chocolate bars per can of cola
B) 10 chocolate bars per can of cola
C) 2 chocolate bars per can of cola
D) 1/2 chocolate bars per can of cola

Accepted Answer

The answer of 
-The above table shows production points on...

Question 14

When moving along the production possibilities frontier, opportunity cost is measured as the
A) increase in the quantity produced of one good divided by the decrease in the quantity produced of another good.
B) decrease in the quantity produced of one good divided by the increase in the quantity produced of another good.
C) quantity produced of one good divided by the quantity produced of another good.
D) quantity produced of one good multiplied by the quantity produced of another good.

Accepted Answer

Opportunity cost along the production possibilities frontier is measured by the decrease in the quantity produced of one good divided by the increase in the quantity produced of another good, reflecting the trade-offs between the two goods.

Question 15

-The table above lists six points on the production possibilities frontier for grain and cars. Given this information, which of the following combinations is unattainable?
A) 6 tons of grain and 18 cars
B) 4 tons of grain and 26 cars
C) 2 tons of grain and 27 cars
D) 7 tons of grain and 10 cars

Accepted Answer

The answer of 
-The table above lists six points on...

Question 16

When operating on its PPF, a country can produce 2 tons of butter and 200 cars OR 3 tons of butter and 150 cars. The opportunity cost of 1 ton of butter is ________ cars per ton of butter.
A) 300
B) 200
C) 50
D) 0.75

Accepted Answer

The opportunity cost of producing 1 additional ton of butter is the number of cars that must be given up to produce that extra ton. Moving from producing 2 tons of butter and 200 cars to 3 tons of butter and 150 cars, the country gives up 50 cars to produce the additional ton of butter. Therefore, the opportunity cost of 1 ton of butter is 50 cars.

Question 17

Opportunity cost is illustrated in a production possibilities frontier (PPF) by a movement
A) from the region within the PPF to a point on the PPF.
B) from the region within the PPF to the region outside of the PPF.
C) from the region outside of the PPF to a point on the PPF.
D) along the PPF where to gain more of one good it is necessary to give some of another good.

Accepted Answer

Opportunity cost is represented on a PPF by moving along the curve, where producing more of one good requires sacrificing some quantity of another good, illustrating the trade-offs and costs involved in production choices.

Question 18

While producing on the production possibilities frontier, if additional units of a good could be produced at a constant opportunity cost, the production possibilities frontier would be
A) bowed outward.
B) bowed inward.
C) positively sloped.
D) a straight line.

Accepted Answer

A production possibilities frontier (PPF) that is a straight line indicates that additional units of a good can be produced at a constant opportunity cost. This contrasts with a PPF that is bowed outward, which would indicate increasing opportunity costs as production shifts between two goods.

Question 19

Opportunity cost is represented on the production possibilities frontier by
A) attainable and unattainable points.
B) efficient and inefficient points.
C) the amount of good Y forgone when more of good X is produced.
D) technological progress.

Accepted Answer

Opportunity cost is represented on the production possibilities frontier (PPF) by the amount of one good that must be forgone to produce more of another good. This is because the PPF illustrates the trade-offs between two goods, showing how producing more of one good results in producing less of the other due to limited resources.

Question 20

As residents of developing countries increase their chocolate consumption, the increased production of cocoa results in
A) increased opportunity cost of cocoa production.
B) decreased opportunity cost of cocoa production.
C) no change in production of other goods and services.
D) increased production of other goods and services.

Accepted Answer

Increased production of cocoa implies that more resources are being allocated to cocoa production, which means there are fewer resources available for the production of other goods and services. This leads to an increased opportunity cost of producing cocoa, as producing more cocoa comes at the expense of producing less of other goods and services.

Quiz 2: The Economic Problem

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. Which of the following statements is TRUE?

-The table above lists six points on the production possibilities frontier for grain and cars. What is the opportunity cost of producing the 26th car?

In one day, Sue can change the oil on 20 cars or change the tires on 20 cars. In one day, Fred can change the oil on 20 cars or change the tires on 10 cars. Sue's opportunity cost of changing oil is than Fred's and her opportunity cost for changing tires is than Fred's.

-The above table shows production combinations on a country's production possibilities frontier. Which of the following is an example of a point that is unattainable?

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. What is the opportunity cost of one chocolate bar if Sweet-tooth Land moves from point C to point D?

At one point along a PPF, 50 tons of coffee and 100 tons of bananas are produced. At another point along the same PPF, 30 tons of coffee and 140 tons of bananas are produced. The opportunity cost of a ton of coffee between these points is

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. A movement from ________ represents the greatest opportunity cost of increasing cola production.

-The table above lists six points on the production possibilities frontier for grain and cars. From this information you can conclude that production is inefficient if this economy produces

-The table above lists six points on the production possibilities frontier for grain and cars. What is the opportunity cost of producing the 5th ton of grain?

At one point along a PPF, 10 pizzas and 7 sandwiches can be produced. At another point along the same PPF, 9 pizzas and 10 sandwiches can be produced. The opportunity cost of a pizza between these points is ________ per pizza.

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. Which of the following is an example of a point that is inefficient?

At one point along a PPF 40 tons of wheat are produced while 80 tons of rice are produced. At another point along the same PPF, 41 tons of wheat are produced while 70 tons of rice are produced. The opportunity cost of producing a ton of wheat between these points is ________ per ton of wheat.

-The above table shows production points on Sweet-Tooth Land's production possibilities frontier. What is the opportunity cost of one can of cola if Sweet-tooth Land moves from point C to point B?

When moving along the production possibilities frontier, opportunity cost is measured as the

-The table above lists six points on the production possibilities frontier for grain and cars. Given this information, which of the following combinations is unattainable?

When operating on its PPF, a country can produce 2 tons of butter and 200 cars OR 3 tons of butter and 150 cars. The opportunity cost of 1 ton of butter is ________ cars per ton of butter.

Opportunity cost is illustrated in a production possibilities frontier (PPF) by a movement

While producing on the production possibilities frontier, if additional units of a good could be produced at a constant opportunity cost, the production possibilities frontier would be

Opportunity cost is represented on the production possibilities frontier by

As residents of developing countries increase their chocolate consumption, the increased production of cocoa results in