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Production Possibilities Curve Flashcards | StudBud

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Production Possibilities Curve

7 terms·StudBud Administration·11,137 plays

In this economics quiz, students will answer questions to test their knowledge on scarcity and opportunity cost.

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Questions 7

Answers

1
An economy has a constant cost PPC. What do you know about the slope?
Convex to origin
Bowed in
Bowed out
A straight line
2
A PPC shows...
The plans for increasing output in the short run
The best combination of goods to produce
Resources are constrained by choices
What can be produced with various combinations of resources
3
Which of the following would not shift an economy's PPC?
Doubling the amount of capital in the economy
A technological advance
An increase in population
An increase in the money supply
4
Which of the following are assumptions underlying the PPC?
Only two goods are produced
All the above
Prices determine the position on the PPC
Technology, population, and capital are variable
5
What statement below implies that a PPC will be an increasing cost curve?
Diminishing marginal returns to scale
Resources are scarce
Most resources are more productive in some uses than others
Underemployment of productive resources
6
Efficiency along the PPC implies...
To get more of a good, some of another must be given up
Goods are produced quickly
The state of technology is maximized
Goods are distributed equitably
7
What determines the opportunity cost along a PPC?
Choices made by the economy
The area under the PPC
The kinds of goods being produced
The slope of the PPC