Question 1

The production possibilities frontier (PPF)shows

Accepted Answer

The production possibilities frontier (PPF) illustrates the trade-off between producing two different goods with limited resources. That is, it shows the maximum quantity of one good that can be produced for each possible quantity of the other good that can be produced, assuming that all resources are fully utilized and used efficiently. Therefore, Choice A is the best option.

Question 2

Think of the production possibilities frontier (PPF)model.When society is producing the largest possible output from its resources,it is operating

Accepted Answer

The PPF model shows the maximum amount of two goods that can be produced with the given resources and technology. When society is producing at a point on the PPF, it is using all of its resources efficiently to produce the maximum amount of goods possible. Therefore, the correct answer is B) efficiently. A) inefficiently and D) inside the PPF are incorrect because they indicate that society is not producing at its maximum capacity. C) with no opportunity cost and E) beyond its opportunity cost are also incorrect because they do not relate to the concept of production efficiency captured by the PPF model.

Question 3

A graph that shows the maximum attainable combinations of two goods when society efficiently uses its productive resources is called

Accepted Answer

A production possibilities frontier (PPF) shows the maximum attainable combinations of two goods when society efficiently uses its productive resources. Option B (a supply curve) only shows the relationship between price and quantity supplied of a particular good. Option C (opportunity cost) is a concept that refers to the cost of a chosen alternative. Option D (a consumer demand curve) shows the relationship between price and quantity demanded of a particular good. Option E (absolute advantage) refers to the ability of a country to produce a good using fewer inputs than another country.

Question 4

The ________ illustrates the various combinations of output that a society can produce if all of its resources are being used efficiently.

Accepted Answer

The production possibilities frontier (PPF) represents the different possible combinations of two goods that a society can produce with its limited resources and technology, assuming that these resources are being used efficiently. It shows the trade-offs that must be made between the production of one good and the production of another. Therefore, option D is the correct answer. The other options are not related to the concept of PPF.

Question 5

use the figure above to answer the following questions : 
-In the figure,point A is

Accepted Answer

Point A is inefficient because it is not on the production possibilities frontier. This means that society could produce more of both goods without sacrificing any of the other good.

Question 6

A model without any simplifying assumptions

Accepted Answer

A model without any simplifying assumptions is likely to be highly complex and difficult to work with. It may also be impractical or unworkable in real-world situations. Therefore, choice A is the best answer. The other options are not accurate in describing such a model.

Question 7

The area inside (within)the production possibilities frontier (PPF)contains ________ points.

Accepted Answer

The area inside the production possibilities frontier (PPF) contains inefficient points because it represents combinations of goods and services that do not fully utilize available resources or technology.

Question 8

At full employment,a society produces

Accepted Answer

At full employment, a society produces on its PPF because all of its resources are being utilized efficiently to produce goods and services. Points outside the PPF represent a level of production that is not attainable with current resources and technology. The origin of the PPF represents an inefficient use of resources and production levels below the society's potential. Only producing one good is not efficient and does not represent full employment.

Question 9

use the figure above to answer the following questions : 
-In the figure,point E is

Accepted Answer

Point E is located beyond the production possibility frontier (PPF), which means it is unattainable with current resources. It represents a level of production that is currently not possible for the economy to achieve.

Question 10

Car companies build wind tunnels to test the aerodynamics and the handling capabilities of their car designs.The many variables that can be precisely controlled inside the wind tunnel are considered ________ factors.

Accepted Answer

Endogenous factors are the variables that can be controlled or manipulated in a scientific experiment. In this case, the wind tunnel is a controlled environment where the aerodynamic and handling characteristics of car designs can be tested under various conditions such as different wind speeds and directions. The other choices, normative, positive, comparative, and exogenous factors do not accurately describe the controlled variables in this scenario.

Question 11

use the figure above to answer the following questions : 
-Which point in the corresponding figure represents a combination of smoothies and milk shakes that society CANNOT currently produce?

Accepted Answer

Point E represents a combination of smoothies and milkshakes that society cannot currently produce because it lies beyond the production possibilities frontier, indicating that the resources and technology available do not allow for this level of production.

Question 12

Ceteris paribus,if a society is producing at a point on the production possibilities frontier (PPF),it can only increase the production of one good by

Accepted Answer

If a society is producing at a point on the PPF, it means all resources are fully utilized, and to increase the production of one good, the resources have to be taken away from the production of the other good. Therefore, the only way to increase the production of one good is by decreasing the production of the other good.

Question 13

One reason that economists make assumptions when designing models is to

Accepted Answer

Economists make assumptions in order to simplify the model and exclude variables that do not add predictive power to the model. This allows economists to focus on the most important factors that affect the relationship between variables in the model.

Question 14

use the figure above to answer the following questions : 
-Which point in the corresponding figure shows that productive resources are NOT fully employed?

Accepted Answer

Point A shows that productive resources are NOT fully employed because it is below the production possibilities curve. This means that the economy is not producing as much as it could with the resources it has available.

Question 15

A society that is producing its maximum combination of goods and using all available resources for production

Accepted Answer

A society that is producing its maximum combination of goods and using all available resources for production is operating on its production possibilities frontier (PPF), which represents the maximum possible output that can be produced given the available resources and technology. This means that all resources are being allocated efficiently and any further production of one good can only be achieved by giving up some production of another good, which represents the concept of opportunity cost. Therefore, the society has not eliminated scarcity but has efficiently utilized the available resources to produce the maximum feasible output.

Question 16

On a production possibilities frontier (PPF)that shows the trade-off between consumer goods and capital goods given a fixed amount of labor,unemployment is illustrated by

Accepted Answer

The PPF represents the maximum combination of goods that can be produced with the available resources. Any point on the frontier represents the efficient allocation of resources, and any point inside the frontier represents inefficient use of resources. Unemployment is illustrated by a point inside the PPF because the economy is producing below its potential. Movement from a point within the frontier to a point on the frontier represents a more efficient use of resources, but it does not represent unemployment. A point outside the frontier is not attainable with the given resources, and movement from a point on the frontier to another point on the frontier does not represent unemployment. Therefore, the best choice is C.

Question 17

When testing a model rocket on a campus quad,which of the following would be an endogenous factor?

Accepted Answer

Endogenous factors are those that are directly related to the system being studied, and can be controlled or manipulated by the experimenters. In this case, the size of the rocket engine is an endogenous factor that the experimenters can control and manipulate to test the rocket. The other factors listed (wind speed, elevation/air pressure, precipitation, and gravitational pull) are exogenous factors that cannot be controlled by the experimenters and may affect the rocket's flight, but are not directly related to the system being studied.

Question 18

When testing a paper airplane on a campus quad,which of the following would be an exogenous factor?

Accepted Answer

Exogenous factors are external variables that are not controlled or influenced by the variables being studied. In this case, the level of wind encountered is an external variable that is not influenced by the design or characteristics of the paper airplane being tested. The other choices are endogenous factors that are influenced by the design or characteristics of the airplane being tested.

Question 19

Which of the following is NOT an assumption that economists make when developing a production possibilities frontier (PPF)?

Accepted Answer

The assumption that society will always be producing somewhere on the PPF is not accurate. The PPF represents potential production levels if resources are fully and efficiently utilized. In reality, economies often operate inside the PPF due to factors like unemployment or inefficiency, not always on it.

Question 20

How will a reduction in the national unemployment rate affect a nation's production possibilities frontier (PPF)?

Accepted Answer

A reduction in the unemployment rate means that more resources (labor) are being utilized, moving the economy closer to or onto the PPF, indicating more efficient production.

Quiz 2: Model Building and Gains From Trade

The production possibilities frontier (PPF) shows

Think of the production possibilities frontier (PPF) model.When society is producing the largest possible output from its resources,it is operating

A graph that shows the maximum attainable combinations of two goods when society efficiently uses its productive resources is called

The ________ illustrates the various combinations of output that a society can produce if all of its resources are being used efficiently.

use the figure above to answer the following questions : -In the figure,point A is

A model without any simplifying assumptions

The area inside (within) the production possibilities frontier (PPF) contains ________ points.

At full employment,a society produces

use the figure above to answer the following questions : -In the figure,point E is

Car companies build wind tunnels to test the aerodynamics and the handling capabilities of their car designs.The many variables that can be precisely controlled inside the wind tunnel are considered ________ factors.

use the figure above to answer the following questions : -Which point in the corresponding figure represents a combination of smoothies and milk shakes that society CANNOT currently produce?

Ceteris paribus,if a society is producing at a point on the production possibilities frontier (PPF) ,it can only increase the production of one good by

One reason that economists make assumptions when designing models is to

use the figure above to answer the following questions : -Which point in the corresponding figure shows that productive resources are NOT fully employed?

A society that is producing its maximum combination of goods and using all available resources for production

On a production possibilities frontier (PPF) that shows the trade-off between consumer goods and capital goods given a fixed amount of labor,unemployment is illustrated by

When testing a model rocket on a campus quad,which of the following would be an endogenous factor?

When testing a paper airplane on a campus quad,which of the following would be an exogenous factor?

Which of the following is NOT an assumption that economists make when developing a production possibilities frontier (PPF) ?

How will a reduction in the national unemployment rate affect a nation's production possibilities frontier (PPF) ?