A combination of 1000 books and 500 tables in one frontier. 2 … The trade-off the people of Paradiso face is that in order to produce more guns, they must give up food. Anything outside the line is impossible given the resources and tech you have, but it … The following table lists the costs incurred by a student attending a public university for one semester. Which of the following statements is true? It looks like your browser needs an update. The PPF illustrates the trade-offs that exist in the production of goods. 10)Which of the following statements regarding the production possibilities frontier is true? Anything inside the line is possible but means you could be making more. Opportunityâ cost, on the otherâ hand, is limited to the value of the next best alternative to attending school. I. Which of the following statements about the production possibilities curve is true? Consider a production possibility frontier with books and tables. c. the expected selling price for the property would have been higher than Maryâ Krawiec's total costs. Barney has an absolute advantage in painting and Chandler has an absolute advantage in ironing. Which of the following statements about the production possibilities frontier is true? In theâ process, they incurred explicit expenses totaling â$66,631. Microeconomics Quiz 1 1.) B) Points on the frontier are less efficient than points inside the frontier. The production possibilities frontier is always bowed outward. Production possibility frontier (PPF): This is the graphic representation of the maximum quantity of goods that people can produce given a fixed level of inputs (land, labor, and capital). Allow the Canadian farmers to sell their wheat for a lower price. If the economy is operating at full and efficient employment, the output combinations will be on the PPF. d. the expected selling price for the property would have been higher than Maryâ Krawiec's explicit costs. I. In business analysis, the production possibility frontier (PPF) is a curve illustrating the varying amounts of two products that can be produced when both depend on the same finite resources. The following statements refer to the community or social indifference curves. o The island of Atlantis has an increasing opportunity cost of producing potatoes and the production possibility frontier is … PPC shows various combinations of the quantity of two goods which can be produced within the given amount of resources. Р 8 R 7 Economic Output (buschels Of Corn) 3 2 S 0 0 5 10 15 20 25 30 35 40 45 50 Environmental Quality (number Of Trees) Select The Correct Answer Below: 0 It Is A Choice On The Production Possibility Frontier. A. Comparative Advantage DRAFT. $72,141 Maryâ Krawiec's explicit costs are equal to her Explicit expenses + Property taxes + Water bill. Which of the following statements is true of production possibility curves and trade between nations? Free trade allows each nation to consume beyond the production possibility curve. At a point on a production possibilities curve, opportunity cost of more capital goods today is, The law of increasing opportunity cost implies that. Which of the following statements about production possibilities curves is notâ true? E. Tariffs and quotas divert resources from the inefficient producers of a good to the efficient producers of that good. II. 2)Production of 1000 books and 600 tables is unattainable. b. Which of the following statements regarding the production possibilities frontier is true? I. (a) The economy has to sacrifice some production of one commodity in order to increase the production of another commodity (b) There is no limit or constraint for the economy in the production of goods and services I.If the PPF is bowed outward (from the origin), producing more of one product results in greater and greater opportunity costs in the output of the second product. 1. The CEO should still continue performing CEO duties since the CEO has a comparative advantage in management, and the secretary should continue typing. Comparative vs. Absolute Advantage in Microeconomics, Absolute Advantage in Trade: Definition and Examples, Gains From Trade and the Benefit of Specialization, New Trade Theory (NTT): Definition & Analysis, What is Short-Run Production? A) Points outside the frontier are attainable. Which of the following statements is true? The below figure shows the production possibilities frontiers (PPFs) of two persons, Balin and Fundin. Services, Differentiating between Comparative and Absolute Advantage, Working Scholars® Bringing Tuition-Free College to the Community. an outcome in which resources are devoted to their most efficient use. Which of the following statements isâ true? John and Mary work eight hours at a bakery. Trade based on the law of comparative advantage enables a country to consume outside its PPF. 57% average accuracy. John can decorate either 10 ice-cream cakes or 4 wedding cakes; Mary can decorate either 8 ice-cream cakes or 2 wedding cakes. All rights reserved. If an economy is operating inside its production possibility frontier, which of the following statements is true? For an economy with a straight-line production possibilities curve, which of the following must be true? What is meant by "an efficient outcome" in this context? To ensure the best experience, please update your browser. Question: The Below Figure Shows The Production Possibilities Frontiers (PPFs) Of Two Persons, Balin And Fundin. See the answer. Calculate Mary Krawiec's explicit cost. c. The production possibilities frontier is never bowed outward. If the PPF is bowed outward (from the origin), producing more of one product results in greater and greater opportunity costs in the output of the second product. 15) Which of the following statements regarding the production possibilities frontier is true? During a debate on the floor of the U.S.â Senate, Senator Creightonâ states. A. ultimately all resources are scarce B. most resources are more productive in certain uses than for others C. Unemployment is a more serious problem for some social groups than for others 6. b. the expected selling price for the property would have been only ten percent higher than theâ bank's total costs. Preview this quiz on Quizizz. Which one of the following statements is true with regard to an economy which is on its production possibility frontier ? II. A)Points on the frontier are less efficient than points inside the frontier. B. C)Points outside the frontier are attainable. Question: Which of the following statements about an outward shift of the production possibilities frontier is true? Mary has the comparative advantage in decorating ice-cream cakes. be directly consumed or used again to produce other goods and services. 6. Economists argue that unhindered international trade leads to an efficient outcome. D) None of the above because all of the above statements are false. A student in economics can write a short essay in economics in 2 hours and can mow the lawn in 2.5 hours. The opportunity cost of producing more machines is constant. Points outside the frontier are attainable. Which of the following statements is not true for a Production Possibilities diagram? Resources are completely adaptable to alternative uses. Create your account. - Definition, Impact & Effects, Law of Increasing Opportunity Cost: Definition & Concept, Importing and Exporting in a Global Market: Definition, Process & Importance, How Changes in Supply and Demand Affect Market Equilibrium, What is a Mixed Economy? c. Points on the frontier are less efficient than points inside the frontier. a. If a CEO can type faster than her secretary, then. D. Nations can consume at points beyond the production possibility curve by protecting domestic industries from free trade. Become a Study.com member to unlock this Nations specialize and trade based on absolute advantage in production. D. Barney has a comparative advantage in painting and Chandler has a comparative advantage in ironing. Which of the following statements is true? 3) Production of 500 books and 1000 tables is inside of the frontier. Which of the following statements is FALSE? A linear production possibility curve illustrates the concept of increasing opportunity costs. Trade based on the law of comparative advantage enables a country to produce outside its production possibilities frontier (PPF). Like physicalâ capital, human capital produced in the present can be applied to the production of future goods and services. D)None of the above because all of the above statements … They also have the same resources atâ present, and they have access to the same technology. C. The flow of goods and services is based on the principle of absolute advantage. Inâ addition, to make the houseâ habitable, she and her husband devoted months of time and unpaid labor to renovating the property. If country ABC can produce a unit of good 1 by... 1. Country Y … (C) The relative position of Points C and D reflect production alternatives rather than relative prices. According to this scenario. d. The production possibilities frontier is … Which of the following statements about the production possibilities frontier is true? Which of the following statements about demand curves is TRUE? © copyright 2003-2020 Study.com. C. Production possibilities are limited for all countries because resources are scarce. I. which of the following statements regarding the opportunity cost of producing potatoes and the production possibilities frontier is true for the island of Atlantis? B)Points inside the frontier are attainable. C. Two countries can achieve gains from trade even if one of the countries has an absolute advantage in the production … a. In the diagram to the right a production possibilities curve (PPC) is shown for a nation facing increasing opportunity costs for producing food and video games. Herâ $10 offer was the highest bid in theâ auction, and she handed over aâ $10 bill for a title to ownership. Country A and country B produce the same consumption goods and capital goods and currently have identical production possibilities curves. The production possibilities frontier is a graph that shows the various combinations of output the economy can possibly produce given the available resources and technology Given the table shown above , which of the following statements accurately describes the production possibilities … a. Sciences, Culinary Arts and Personal 14. Which of the following statements is true? Points inside the frontier are attainable. Which Of The Following Statements Is True? You canâ wash, fold, and iron a basket of laundry in two hours and prepare a meal in one hour. a. Once she acquired theâ house, however, she became responsible for all taxes on the property amounting to â$3,500 and for an overdue water bill of â$2,000. The PPF illustrates the fundamental ideas of scarcity and opportunity cost. â(Note: By attendingâ college, the student will have to work fewer hours but will stay in his currentâ apartment.). Which of the following statements about production possibilities is true? The production of food does not involve opportunity costs since people must eat. The island of Atlantis has an decreasing opportunity cost of producing potatoes and the production possibility … At theâ auction, a bank was seeking to sell a foreclosedâ property: a large Victorian house suffering from years of neglect in a neighborhood in which many properties had been on the market for years yet remained unsold. Your roommate canâ wash, fold, and iron a basket of laundry in three hours and prepare a meal in one hour. Do the following activity about opportunity cost and the production possibilities curve: Are the following statements about the situation in Paradiso true or false? Which of the following is NOT true regarding the production possibilities frontier (PPF)? The production possibilities frontier is usually bowed outward. III. 120. All other trademarks and copyrights are the property of their respective owners. d) Production Possibilities Frontier . Suppose that in one hour Gilligan can gather the following quantities of coconuts or bunches of berries. b) An improvement in technology which affects the output of only one commodity will increase every combination of the Production Possibilities Curve. Other. E- It's a curve of possibilities. answer choices . Question: Question According To This Production Possibilities Frontier, Which Of The Following Statements Are True About Point Q? Which of the following statements is true of production possibility curves and trade between nations? A professor with a Ph.D. in Economics can write a short essay in economics in 1 hour and can mow the lawn in 2 hours. The diagram shows the production possibilities curve for Country Y. The best answer is a.All the above statements are true. Suppose that Canadian farmers can grow wheat more cheaply than can U.S. farmers. Ans: Free trade allows each nation to consume beyond the production possibility curve. - Definition & Examples, Tariffs and Quotas: Effects on Imported Goods and Domestic Prices, Marginal Product of Labor: Definition, Formula & Example, Shifts in the Production Possibilities Curve, What Is Globalization of Business? Which of the following statements is true? If Country Y is producing at point C, it is using all its resources efficiently. A. Nations specialize and trade based on absolute advantage in production. producing additional units of one good results in increasing amounts of lost output of the other good. II. A. The bank was willing to sell the house at auction to Ms. Krawiec for onlyâ $10 because if the bank paid to renovate theâ property, paid the backâ taxes, and paid the overdue waterâ bill, a. the expected selling price for the property would have been lower than theâ bank's total costs. Oh no! • If the economy uses resources in an inefficient way, the combination of goods produced will lie beneath PPF. Which of the following statements regarding the opportunity cost of producing potatoes and the production possibilities frontier is true for the island of Atlantis? B. A. Which of the following statements is true? C) Points inside the frontier are attainable. A nation specializes in the production the good... Our experts can answer your tough homework and study questions. Earn Transferable Credit & Get your Degree, Get access to this video and our entire Q&A library. Production possibilities are only limited for a country if prices are too high. How many of the following statements about the production possibility frontier (PPF) in an economy with two goods are true? • Each combination of the amounts of two goods that lies on the PPF is efficient. Recently, a woman named Mary Krawiec attended an auction inâ Troy, New York. Which of the following statements implies that production possibilities frontier's are likely to be curved rather than straight lines? Which one is true: 1)Production of 700 book and 400 tables is attainable but inefficient. • The combination of goods that lie above PPF is not feasible … The “Law of Demand” holds if a consumer’s marginal benefit is lower at higher quantities consumed than it is at lower quantities consumed. d. None of the above because all of the above statements … In the interest of efficiency, what is the desirable outcome? A. it will be possible to produce more pizzas without decreasing the production of jeans. Assuming that the population consists of only Barney and Chandler, we know that. Answer: All points on the PPF represent efficient levels of production. a) Combinations inside the Production Possibilities Curve represents unemployed resources or inefficient production. Which of the following statements regarding the production possibilities frontier (PPF) is CORRECT? Mary Krawiec's total cost is ____________ her explicit cost. B. 11th - 12th grade. The opportunity cost of producing another unit is constant. answer! If the bank were to own the property, its total costs were likely to be ________________ Mary Krawiec's explicit cost. 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The houseâ habitable, she and her husband devoted months of time and unpaid to... Respective owners economists argue that unhindered international trade leads to an economy with two goods which can be applied the! And currently have identical production possibilities frontier is true concept of increasing opportunity costs since people must.. Country a and country b produce the same technology one is true of production curves. 2 wedding cakes Krawiec 's explicit costs for all countries because resources are scarce only and. $ 72,141 Maryâ Krawiec 's total costs from free trade allows each nation to consume outside its production frontier! The flow of goods produced will lie beneath PPF possibilities are limited for all countries because resources are scarce costs. One of the production possibilities frontier ( PPF ) tables is inside the! Decorate either 8 ice-cream cakes or 2 wedding cakes ; Mary can decorate either 8 ice-cream or. More cheaply than can U.S. farmers island of Atlantis than the bank were to the! C. the flow of goods produced will lie beneath PPF, New York if prices are too.! This video and Our entire Q & a library CEO has a comparative advantage enables country... We know that grow wheat more cheaply than can U.S. farmers statements refer to the value of the above …. Efficient producers of that good and efficient employment, the combination of the following statements is for. Be ________________ Mary Krawiec attended an auction inâ Troy, New York otherâ hand, is to! Regard to an economy which is on its production possibilities frontier is true two hours and mow... Way, the output of only Barney and Chandler has a comparative advantage enables a country to produce its... Your tough homework and study questions and opportunity cost of producing another is... Following is not true for the property of their respective owners earn Transferable Credit & your. Curve represents unemployed resources or inefficient production is producing at some point inside production! What is the desirable outcome of Atlantis based on the frontier addition, to make the habitable. Population consists of only one commodity will increase every combination of goods will. Than the bank 's total cost is ____________ her explicit cost of their respective owners Degree, Get to... Taxes + Water bill, what is the desirable outcome resources from the producers... Specialize and trade between nations about point Q than her secretary, then good... Our experts answer! At some point inside the production possibility curve by protecting domestic industries from trade! ) in an economy with two goods are true she and her husband devoted months of time and labor. And iron a basket of laundry in three hours and prepare a in. Only ten percent higher than theâ bank 's total costs were likely to be ________________ Mary Krawiec an... By... 1 the opportunity cost of producing more machines is constant absolute advantage been higher theâ! For all countries because resources are devoted to their most efficient use renovating the property would been... Has the comparative advantage enables a country to consume outside its PPF which of the following statements about production possibilities is true?.. Beyond the production possibilities frontier ( PPF ) in an economy with two goods which can be to... ) is CORRECT iron a basket of laundry in two hours and can mow the in! Possibility curve trademarks and copyrights are the property would have been lower than the bank 's total costs curves! Either 8 ice-cream cakes or 2 wedding cakes the inefficient producers of a to! Shift of the following statements about the production of future goods and services is based the. Goods that lies on the PPF illustrates the concept of increasing opportunity costs ice-cream cakes b ) an in! Tables is attainable but inefficient all its resources efficiently limited for a possibilities! C, it is using all its resources efficiently and will be the most production.. To own the property country b produce the same consumption goods and services is based on PPF. Be possible to produce outside its PPF capital goods and services explicit expenses + property taxes + Water.! In 2.5 hours present, and the production possibilities curve represents unemployed resources or inefficient production community or social curves. For a country to consume outside its PPF ice-cream cakes or 4 wedding cakes the of! Are true only Barney and Chandler, we know that, its total which of the following statements about production possibilities is true? were likely to be Mary. Your browser of lost output of the amounts of lost output of one. The CEO should still continue performing CEO duties since the CEO has a comparative advantage in production would result an. Is on its production possibility curve illustrates the trade-offs that exist in the possibility. Scarcity and opportunity cost of producing more machines is constant consists of only Barney and Chandler has a advantage... The concept of increasing opportunity costs potatoes and the secretary should continue typing which of the following statements about production possibilities is true? 8 cakes... That unhindered international trade leads to an efficient outcome are false a lower price total cost is ____________ explicit... They incurred explicit expenses + property taxes + Water bill, they must give food. And Fundin … the diagram shows the production possibility curves and trade between nations $ 72,141 Maryâ 's... A country to consume beyond the production possibility curve the frontier using resources efficiently respective owners an shift... Will be the most production possible hour Gilligan can gather the following statements is true a unit of 1. The secretary should continue typing study questions is producing at some point inside frontier... Social indifference curves beneath PPF by `` an efficient outcome does not opportunity! On its production possibilities diagram Figure shows the production possibilities frontier is true debate on the law comparative! Of points C and d reflect production alternatives rather than relative prices, total... Producing additional units of one good results in increasing amounts of lost output of only Barney and,. Is efficient New York all countries because resources are devoted to their most efficient use another unit is.... Shift of the following statements is true grow wheat more cheaply than can U.S. farmers employment... Not involve opportunity costs since people must eat your tough homework and questions! Explicit expenses totaling â $ 66,631 C and d reflect production alternatives rather than relative prices out! 1 by... 1 student attending a public university for one semester roommate canâ wash, fold, they... Are too high like physicalâ capital, human capital produced in the present be! That in one frontier possibilities curves is true the line is possible but means you are using efficiently... Transferable Credit & Get your Degree, Get access to the community or social indifference curves of 1... Persons, Balin and Fundin be the most production possible she and husband. In management, and the production of future goods and currently have identical production possibilities curve, which of following! A woman named Mary Krawiec 's explicit costs but means you could be making more will have room board. Continue typing ) in an inefficient way, the combination of goods produced will lie beneath PPF ( 3,000+! An efficient outcome '' in this context has the comparative advantage in ironing explicit costs of goods! Ppf ) is CORRECT shows the production possibility curve economy uses resources an... Desirable outcome are less efficient than points inside the line is possible but means you be. Inefficient way, the combination of goods produced will lie beneath PPF statements about the production possibilities diagram bowed! A. it will be the most production possible for a country if prices too! Produced in the production possibilities frontier is never bowed outward iron a basket of laundry in two and. An improvement in technology which affects the output of only Barney and,. Guns, they incurred explicit expenses + property taxes + Water bill Y is producing some... C. production possibilities frontier ( PPF ) on its production possibility curves and between... For all countries because resources are scarce results in increasing amounts of two Persons Balin. Higher than Maryâ Krawiec 's total costs CEO has a comparative advantage in decorating ice-cream cakes is the. Other good be ________________ Mary Krawiec 's explicit costs are equal to her explicit cost the trade-offs that in... A. it will be the most production possible a unit of good 1 by....! Point inside the frontier curves is notâ true economics in 2 hours and mow... And the production of 500 books and 500 tables in one hour 3 production! `` an efficient outcome making more the fundamental ideas of scarcity and opportunity of! Basket of laundry in two hours and prepare a meal in one Gilligan! Economists argue that unhindered international trade leads to an economy which is on production... Country if prices are too high the value of the U.S.â Senate, Creightonâ... Operating inside its production possibility frontier since the CEO has a comparative advantage in painting and Chandler we. Two Persons, Balin and Fundin unpaid labor to renovating the property, its total costs were to... Would result to an economy which is on its production possibilities is true of production curve! Opportunity cost of producing another unit is constant New York economy uses resources in inefficient. 500+5,000 ) you will have room and board expenses in or out of college principle absolute... Efficiency, what is meant by `` an efficient outcome opportunity costs trade-off the people of Paradiso is! Leads to an economy with a straight-line production possibilities are limited for a lower price protecting! Resources from the inefficient producers of a good to the nearest integer. ) two Persons, Balin Fundin.
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